Apologies for not clarifying what the second picture was.. I decided to retake a photo of the questions, so hopefully, this one will suffice! Thanks in advance for all the help!

 

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5. Some true-false questions. a. As long as the production function is constant returns to scale, it must be that the factor demand for factor 1 is decreasing in the factor price for factor 1 (if the firm produces). b. In the short-run, the firm always produces a positive amount of output; but in the long-run, they might produce zero output given market prices. c. There are situations where even though the production function is strictly concave and decreasing returns to scale, if the price of the output good increase, the firm actually lows the input level of one factor. d. The reason the long-run profit maximization problem can be thought of as the "envelope" of a collection of short-run problems is one can think about the short-run fixed factors being set at the optimal long-run level, and then the 5. Some true-false questions. a. As long as the production function is constant returns to scale, it must be that the factor demand for factor 1 is decreasing in the factor price for factor 1 (if the firm produces). b. In the short-run, the firm always produces a positive amount of output; but in the long-run, they might produce zero output given market prices. c. There are situations where even though the production function is strictly concave and decreasing returns to scale, if the price of the output good increase, the firm actually lows the input level of one factor. d. The reason the long-run profit maximization problem can be thought of as the "envelope" of a collection of short-run problems is one can think about the short-run fixed factors being set at the optimal long-run level, and then the

Answer rating: 100% (QA)

a False b False c True d True e False f True a This is false because the factor demand for factor 1 ... View the full answer