Why should joe change the amount of labor in each forest

Assignment Help Econometrics

Reference no: EM13209570

Trapper Joe, the fur trader, has found that his production function in acquiring pelts is given by
q = 2"H
where q = the number of pelts acquired in a day, and H= the number of hours Joe's employees spend hunting and trapping in one day. Joe pays his employees $8 an hour.

a. Calculate Joe's total and average cost curves (as a function of q).

b. What is Joe's total cost for the day if he acquires four pelts? Six pelts? Eight pelts? What is Joe's average cost per pelt for the day if he acquires four pelts? Six pelts? Eight pelts?

c. Graph the cost curves from part a and indicate the points from part b. Explain why the cost curves have the shape they do. Now, Joe decides to split his operations between two forests and hire his buddy Earl. The production function becomes: qi = 2"Hi where i = 1, 2. H1 represents Joe's hours trapping in forest 1 and H2 Earl's in forest 2

d. What is the general expression for the marginal product of labor (H) in location i? Hint: because this is a short-run function think of K = 1.

e. Suppose H1 = 25 and H2 = 36. What is the total amount of pelts? If the market wage is $8 in forest 1 and $9 in forest 2 should Joe change the amount of labor in each forest? Explain.

Reference no: EM13209570

Questions Cloud

Inclusion of a compulsory arbitration clause : Inclusion of a compulsory arbitration clause and the comparative merits of arbitration in Australia, the Philippines or elsewhere and choice of the arbitrator or arbitral body.

Explain what is the ph of the solution of acetic acid : A solution is made by adding 70.00grams of sodium acetate to 550.0mL of 0.60 mol/L solution of acetic acid. a.What is the pH of the

What if any country was taken over by dictator diana : What if you lived on a tropical island with such abundant fish and game, fruits and berries, natural shelters like caves, and firewood that the citizens did not have to work and GDP was very low Would the citizens' sense of well-being be lower tha..

State the gibbs energy of solvation of methane in pure water : Use the above simulation results for methane in pure water, combined with the Widom theorem to predict the Gibbs energy of solvation of methane in pure water and compare your result with methane's experimental hydration Gibbs energy of 8.4 kJ/mol?

Why should joe change the amount of labor in each forest : Graph the cost curves from part a and indicate the points from part b. Explain why the cost curves have the shape they do. Now, Joe decides to split his operations between two forests and hire his buddy Earl. The production function becomes: qi = ..

Communicating the authors purposes : Explain what effect these two different points of view might have on a 19th century reading audience in communicating the authors' purposes.

What is the current macroeconomic situation in the us : What is the "current macroeconomic situation" in the U.S. (e.g. is the U.S. economy currently concerned about unemployment, inflation, recession, etc.) What fiscal policies and monetary policies would be appropriate at this time

Compute the pressure that ccl4 gas will exert at 40 degree : Calculate the pressure that CCl4 gas will exert at 40 degrees celsius if 1.00 mol occupies 28.0 L, assuming that: A. CCl4 obeys the ideal-gas equation

Awareness of oppression and arousing sympathy of supporters : By creating awareness of oppression and arousing sympathy of supporters, the arts can be a form of protest. Identify and describe an example of how either black slaves or white abolitionists used the arts as a form of protest against slavery.

User Account

All Pages