Calculate the amount of output the firm should expect

Reference no: EM131975315

Question: A firm has the following production function: Q = 7*K^1/2*L^1/2

a) Calculate the amount of output the firm should expect if it uses 25 units of capital and 50 units of labor.

b) Suppose the firm wants to produce the same amount of output from a), but only has 15 units of capital. How much labor will it need to hire?

c) Suppose that a unit of capital costs $50, and a unit of labor costs $20. What is the cost of producing that quantity in part a) and in part b)?

Reference no: EM131975315

Questions Cloud

Desirable for a healthcare organization : Which types of debt are the most desirable for a healthcare organization and why?

What is matt capital gain : Matt incurred $25,000 for the building of an extension to the property on 10 October 2016. What is Matt's capital gain

Find the present value using a formula to answer : Assume that the cash flows at the end of each year are given as: CF1 = $110, CF2 = $0, and CF3 = $200, and the interest rate is 10% for each year.

What is the correct journal entry to record : Semiannual interest payments are made on June 30 and December 31 of each year. What is the correct journal entry to record the first interest payment

Calculate the amount of output the firm should expect : Calculate the amount of output the firm should expect if it uses 25 units of capital and 50 units of labor. Suppose the firm wants to produce the same amount.

Create the journal entry to record the purchase : Create the journal entry to record this purchase in the correct amount, assuming a perpetual inventory system.

What was the standard materials quantity per unit : Kansas Company uses a standard cost accounting system. If the materials quantity variance was $11,454 unfavorable, what was the standard materials quantity

What is economic valued added for the current fiscal year : A firm is financed with $350,000 of equity and $650,000 of long-term debt, as of the beginning of the current fiscal year. During the same fiscal year.

Calculate the working capital and current ratio : Calculate the working capital, current ratio, and acid-test ratio for Tibbetts Company as of September 30, 2016.

User Account

All Pages