Optimum combination of resources, Managerial Economics

Assignment Help:

Optimum combination of resources

The firm can maximise output given costs.  That is when the entrepreneur attains the highest isoquant given a particular Isocost.

1460_optimum combination of resources.png

At the point of tangency the absolute slope of Isoquant will be equal to the slope of the Isocost.  Two conditions should however prevail, namely:

i.   The necessary condition is that

                        w/r  = MPL/MPk                    or       MPL/PL   =    MPk/Pk

ii. The sufficient condition is that the Isoquant must be convex to the Isocost point of Tangency.

 

1653_optimum combination of resources1.png


Related Discussions:- Optimum combination of resources

PRICE CUTS FOR MEDICINE case study, 1. What kind of market structure is inv...

1. What kind of market structure is involved for the sale of medicines and vitamins? 2. What can be said about barriers to entry in this market? 3. Might there be a change in mar

An optimum population, An optimum Population Countries are often descr...

An optimum Population Countries are often described as under populated or overpopulated.  From the economist's viewpoint these terms do not refer to the population density (i.

Assignment, price output determination under monopoly explain

price output determination under monopoly explain

Briefly explain the importance of forecasting for managers, Question: i...

Question: i) Briefly explain the importance of forecasting for managers? ii) To what extent will managers rely on surveys in business forecasting? iii) What do you mea

Cross elasticity, Cross Elasticity Cross elasticity of demand measures...

Cross Elasticity Cross elasticity of demand measures the degree of responsiveness of the quantity demanded of one good (B) to changes in the price of another good (A).  It is

Many dollars of change in consumption, Given a saving function of S = -25 +...

Given a saving function of S = -25 + .2Yd, a $10 billion enhance in government spending will bring about how many dollars of change in consumption?

Explain about labour economies, Q. Explain about Labour Economies? Lab...

Q. Explain about Labour Economies? Labour Economies: As the size of output increases the firm enjoys labour economies because of (a) specialisation, (b) time-saving (c) autom

Ab, isoquant and its properties

isoquant and its properties

Predicting the stock market, In this question you will consider the impact ...

In this question you will consider the impact on the building industry of the earthquake. Two construction and materials indices have been provided for the analysis.  If your famil

the occupancy rate of the hospital, In 2006, a hospital with 130 beds had ...

In 2006, a hospital with 130 beds had 8,795 admissions. The average length of stay?for every patient was 4.7 days. Assuming full capacity is 100 percent, detremine the occupancy ra

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd