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Problem 4 a) The local cleaner launders white clothes using the production function q =G + ZS , where G is the number of cups of a generic bleach and S is the number of cups of a super bleach that is twice as potent. Problem Set 5 1 Intermediate Mcroeconomics Spring 2020 Prof. Musatti a.1) What are the marginal product of G and S? What is the marginal rate of technical substitution? Does the MRTS depend on the mix of G and S the local cleaner uses? a.2) In a graph, draw an isoquant. b) Ann and Bob can increase their grades on an upcoming exam by studying. Their production functions depend on the number of hours they spend studying consumer choice theory (C) and the number of hours they spend studying the theory of the rm (F). Ann nds the theory of the rm more intuitive and faster to absorb than Consumer Choice theory while the reverse is true for Bob. In a diagram, measuring hours spent on consumer choice theory along the horizontal axis and hours spent on the theory of the rm along the Vertical axis draw two possible isoquants, one for Ann and one for Bob. c) Juan uses equipment (K), labor (L) and supplies (S) to produce new smart phone apps according to the production function Q =K'335L015OSM5. a) What kind of returns to scale does this production function exhibit? b) What is the marginal product of labor? Does this exhibit diminishing marginal returns? c) What is the marginal rate of technical substitution of equipment for labor services? Does it depend on Juan's usage of supplies? d) Suppose Juan has rented 16 pieces of equipment (K = 16), in a diagram measuring labor along the horizontal axis and supplies along the Vertical axis draw one of Juan's isoquants