What is the marginal cost of an increase in w1

Reference no: EM13220187

Assume a firm wants to minimize its cost of producing y amount using x1 and x2 as inputs, which means it wants to minimize w1x1 + w2x2 subject to x1^(1/2)x2^(1/2)= y:

(a) Using Lagrange multiplier method, find optimal x1 and x2 as functions of w1,w2 and y.

(b) What is the marginal cost of producing a higher level of y?

Reference no: EM13220187

Questions Cloud

Which companys marker share do you think will grow : Two car manufacturers, Saab and Volvo, have fixed costs of $1 billion and marginal costs of $10,000 per car. If Saab produces 50,000 cars per year and Volvo produces 200,000, calculate the average production cost for each company.

Explain is the franc selling at a premium or discount : The 1-year interest rate in the U.S. is 10%; in Switzerland it is 12%. The current spot rate (dollars per franc) is $0.40. a. What do you expect the 1-year forward rate to be b. Is the franc selling at a premium or discount

Define the solutions are a mixture of salts : a solution of 4.00 g of sodium carbonate is mixed with one containing 4.00 g of silver nitrate. after the reaction is complete, the solutions are a mixture of salts.

Determine what total profit would the monopolist make : A market contains two types of consumers, green and yellow. Each green consumer has a demand of P = 20-Q. Each yellow consumer has a demand of P=16-Q. These are individual demand curves. The monopolist who sells to these individuals has a MC

What is the marginal cost of an increase in w1 : Assume a firm wants to minimize its cost of producing y amount using x1 and x2 as inputs, which means it wants to minimize w1x1 + w2x2 subject to x1^(1/2)x2^(1/2)= y: (a) Using Lagrange multiplier method, find optimal x1 and x2 as functions of w1,w2 ..

Explain compound that has a measured vapor pressure : Determine ΔHvap for a compound that has a measured vapor pressure 24.3 torr at 273 K and 135 torr at 325 K: 1. 34 kJ/mol, 2. 13 kJ/mol, 3. 24 kJ/mol, 4. 79 kJ/mol, 5. 41 kJ/mol

How much labor should bad breath hire n what wage should pay : Bad Breath, Inc. Sells its output at $1 per unit into competitive markets. Bad Breath's factory is the only employer of labor in Gilroy, California. It faces a supply from competitive workers of QL = w where QL is the number of workers hired per year

Define what is the chloride concentration ppt : If the standard deviation of your pipet is 0.018 mL, what is the chloride concentration ppt (W/V) of you sample?

Evaluate the work done in joules by the reaction : Calculate the work done in joules by the reaction when 0.21 g of Na reacts with water to form hydrogen gas at 1°C and 3.0 atm in an open container.

User Account

All Pages