Short-run production function

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Suppose the short-run production function is q = L^0.5. If the marginal cost of producing the tenth unit is $5, what is the wage per unit of labor? Can a Cobb-Douglas production function possess varying returns to scale? Explain! Assume that the Cobb-Douglas production function for a beer manufacturer is q=1.52L^0.6K^0.4. Calculate the average fixed cost if we also assume that the firm's capital is fixed at 250 units and the rental rate of capital is $5 per unit. Discuss and explain the situation involving the tangency between the isocost line and the isoquant.

Reference no: EM131805654

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