Production and costs , Business Management

Assignment Help:

A bottling company uses two inputs to assemble bottles of the soft drink Squish: bottling machines and workers. Running the bottling machine is an imperfect substitute for the labor performed by the workers. The production function is: 

  q = 100 K1/4 L½

The implicit rental rate plus hourly operating cost of the machine is r = $15 per hour; and the workers each earn w = $20 per hour.   

The current level of input use for the production of q=1000 bottles is:

 K=16 machine hours and L=25 labor hours.

 Question: Is this firm producing at minimum cost?  If it is minimizing costs, explain why.  If it is not minimizing costs, explain how the firm should change its input use to lower its costs.

For full credit, you must discuss the two efficiency conditions for minimizing cost.  That is:

  Is the bundle technologically efficient?  (yes/no/why or why not)

  Is it economically efficient?  (yes/no/why or why not)


Related Discussions:- Production and costs

Difference between disaster recovery and business continuity, 1. Differenti...

1. Differentiate between disaster recovery and business continuity. In your answer provide examples of the processes and technology involved. 2. The decision to choose a DAS, NA

Marketing interface, mention 5 measures that will make a dis pleased custom...

mention 5 measures that will make a dis pleased customer patronize the school canteen

Describe when a meeting could be called in business context, QUESTION 1 ...

QUESTION 1 (a) Describe when a meeting could be called in a business context? (b) Describe the advantages as well as disadvantages of meetings QUESTION 2 Write shor

Contemporary Management, I''m kindly asking to make an assignment against "...

I''m kindly asking to make an assignment against "Contemporary Management Issues" in maximum words of 2,500 words as per the attachment. kindly try to finish them as soon as possib

Advertisment, how does the advertisement of product and service help busine...

how does the advertisement of product and service help business to become successful in this modern corporate world?

Safety organization, Safety Organization  A safety organization consis...

Safety Organization  A safety organization consists of a systematic procedure by means  of which  interest is  co rated and  maintained and all safety activities  are co relat

Describe briefly the sources of attitude formation, Question 1: a) Ide...

Question 1: a) Identity the four types of work teams. b) Describe the three elements which constitute a work team. c) Explain how do Industrial Psychologists help orga

What is the prime aim of a good inventory control, What is the prime aim of...

What is the prime aim of a good inventory control? A good inventory control will aim to: 1. Procure material of good quality within time 2. It doesn’t to face shortage of

Ledership and organization behaviors, what are the challenges of only seein...

what are the challenges of only seeing the behaviors?

The major characteristics of physical development, QUESTION Based on wh...

QUESTION Based on what was discussed during your lectures on how children learn, answer the following questions. (a) Explain 4 strategies that you would use to enhance the l

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