Production functions and cost

Please see the attached file for full problem description. --- 4 The production of barstools (q) is characterized by a production function of the form a. Derive general expressions for average productivity of labor and capital for barstool production as functions of K and L. (Hint: By definition, = q/L and = q/K) b. Graph and curve for K=100 c. Graph the q= 10 isoquant. Show all K-L combinations in a table. d. The point K=10, L=10 is one point on the q =10 isoquant. What value of K corresponds to L= 11 on that isoquant? What is the approximate value for the RTS at K = 10, L=10? 5 Qin is a wheat farmer in the southern part of China. Being one of many, he is ... click for more

Economics/Microeconomics

Please see the attached file for full problem description. Solutions:1 a) If Twinkies cost $0.10 each and Slice costs $0.25 per cup, what is his budget constraint? Write down the budget equation and draw the budget line: Budget constraint $0.10T + $0.25S = $1 to draw the budget line: for example consider this two points A( T=0; S=4) and B(T=10; S=0) AND c(T=5, s=2) B) Where does the budget line intersect (touch) the indifference curve for U =10^1/2. To answer a question like this first, one should determine the TMS between T and S which is the point in which budget line is tangeant to the utility fonction. U't/U's=Price of T / price of S. (1/2*S^1/2*T^-1/2)/(1/2*T^1/2*... click for more

Consumer theory

Suppose that you consume nothing but lemonade and pizza. In 1996, your income is $10 per week, lemonade costs $1 per bottle, and pizza costs $1 per slice. You buy 6 bottles of lemonade and 4 slices of pizza per week. In 1998, your income rises to $20 per week, the price of lemonade rises to $2.50 per bottle, and the price of pizza rises to $1.25 per slice. In which year were you happier? In which year do you eat more pizza? Justify and illustrate your answer.

Consumer Economics

Suppose that you consume nothing but lemonade and pizza. In 1996, your income is $10 per week, lemonade costs $1 per bottle, and pizza costs $1 per slice. You buy 6 bottles of lemonade and 4 slices of pizza per week. In 1998, your income rises to $20 per week, the price of lemonade rises to $2.50 per bottle, and the price of pizza rises to $1.25 per slice. In which year were you happier? In which year do you eat more pizza?

Solving the problem of busy signals

Dragon, Inc. is a large marketing company that sells recorded DVDs to phone-in customers. Demand for Dragon's products is running ahead of the firm's capacity to process orders so that customers are encountering busy signals when attempting to place telephone orders, and many customers are giving up. Dragon estimates that sales could increase considerably if the problem could be resolved. Dragon has two alternative strategies for solving the problem of busy signals. One strategy would involve adding some additional WATS lines to carry the phone traffic. Each WATS line can handle 120 calls per hour and costs the firm $25 per hour. The other strategy is to hire additional workers to handl... click for more