3. The production function of TJ Coffee Shop is expressed as q = 10K0.5 10.5 where...

 

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3. The production function of TJ Coffee Shop is expressed as q = 10K0.5 10.5 where q is the cups of coffee produced in TJ Coffee Shop in a month, while K and L, respectively, are machine hours and working hours of employees per month. (25 points) a. In the short run, only employees are variable, while machines are fixed. Draw the graphs of the total product, the marginal product of labor (MPL), and the average product of labor (APL), and show how many unit of outputs of coffee should be produced in the short run. (10 points) b. The wage rate for employees is IDR 20 million per month, while the cost of one machine unit is IDR 80 million per month. Currently, TJ Coffee Shop produces 100 units of output and employs 20 employees and uses 5 units of production machines. This combination of factors of production is the most efficient for the company. Show the above situation in a diagram and explain. (5 points). c. What should TJ Coffee Shop do in the future to produce 200 units of output when it can change the combination of all its factors of production? Draw and compare the resulting cost production with the condition in question (b). (10 points) 3. The production function of TJ Coffee Shop is expressed as q = 10K0.5 10.5 where q is the cups of coffee produced in TJ Coffee Shop in a month, while K and L, respectively, are machine hours and working hours of employees per month. (25 points) a. In the short run, only employees are variable, while machines are fixed. Draw the graphs of the total product, the marginal product of labor (MPL), and the average product of labor (APL), and show how many unit of outputs of coffee should be produced in the short run. (10 points) b. The wage rate for employees is IDR 20 million per month, while the cost of one machine unit is IDR 80 million per month. Currently, TJ Coffee Shop produces 100 units of output and employs 20 employees and uses 5 units of production machines. This combination of factors of production is the most efficient for the company. Show the above situation in a diagram and explain. (5 points). c. What should TJ Coffee Shop do in the future to produce 200 units of output when it can change the combination of all its factors of production? Draw and compare the resulting cost production with the condition in question (b). (10 points)