Find the marginal productivity of money

Assignment Help Microeconomics

Reference no: EM131801614

Question: Production a company has the Cobb-Douglas production function

z = 400x^0.6y^0.4

where x is the number of units of labor, y is the number of units of capital, and z is the units of production. Suppose labor costs $150 per unit, capital costs $100 per unit, and the total cost of labor and capital is limited to $100,000.

(a) Find the number of units of labor and the number of units of capital that maximize production.

(b) Find the marginal productivity of money and interpret it.

(c) Graph the constraint with the optimal value for production and with two other z-values (one smaller than the optimal value and one larger).

Reference no: EM131801614

Questions Cloud

Discuss about indifference curve for maximum utility : Utility suppose that the utility function for two commodities is given by U = x - y3, and the budget constraint is 10x + 15y = 250.

Prepare an annotated bibliography of category of larceny : Provide a minimum of six (6) sources; two of robbery, two on burglary and two on any category of larceny (as covered this week).

Outline various decision necessary to mitigate such disaster : For the past 10 years, 90% of the transatlantic/transpacific cargo entering the US. Outline the various decisions necessary to mitigate such a disaster.

Prepare the journal entries for issuance of preferred stocks : The corporation assigned a $4 stated value to the common stock, Prepare the journal entries for Issuance of preferred stocks for cash

Find the marginal productivity of money : Find the number of units of labor and the number of units of capital that maximize production. Find the marginal productivity of money and interpret it.

What is conflict and what is groupthink : What is conflict? What is Groupthink? Have you ever experienced a groupthink in your life?

Analyze us coast guard efforts to conduct interdiction : Identify and analyze specific U.S. Coast Guard efforts to conduct maritime surveillance, interdiction, and security operations in the past 10 years.

The estimation of costs is generally most difficult : For which of the following process type, the estimation of costs is generally most difficult? Process selection also comes into play as a result of:

What were the steps you undertook in making the decision : Stewardship, Risk, Decision Making, Responsibility and Accountability - What were the steps you undertook in making the decision

User Account

All Pages