Question 1

Skateboards are produced according to the production function, q = 10K^0.25L^0.5 - L. At what quantity of labor does total product begin to decline given that capital is fixed at 16 units in the short-run?

Accepted Answer

The answer of Skateboards are produced according to the production...

Question 2

Suppose the production function for T-shirts can be represented as q = L^0.25K^0.75. Show that the marginal productivity of labor diminishes in the short run.

Accepted Answer

The answer of Suppose the production function for T-shirts can...

Question 3

Lectures in microeconomics can be delivered either by an instructor (labor)or a movie (capital)or any combination of both. Each minute of the instructor's time delivers the same amount of information as a minute of the movie. Which graph in the above figure best represents the isoquants for lectures in microeconomics when capital per day is on the vertical axis and labor per day is on the horizontal axis?

Accepted Answer

Isoquants for lectures in microeconomics would show combinations of labor and capital that produce the same amount of output (i.e. delivering the same amount of information per day). As each minute of the instructor's time is equivalent in output to a minute of the movie, the isoquants would be linear with a slope of -1. Graph C shows such isoquants, with the steeper slope indicating a higher capital-to-labor ratio for the same level of output. Graphs A, B, and D do not represent the correct relationship between labor and capital for producing lectures in microeconomics.

Question 4

Each additional worker produces two extra units of output until the first three units are produced for some production function. After the third unit is produced each additional worker produces one extra unit of output. What are the total product of labor, average product of labor and marginal product of labor for the first five units of production associated with this production function?

Accepted Answer

The answer of Each additional worker produces two extra units...

Question 5

Lectures in microeconomics can be delivered either by an instructor (labor)or a movie (capital)or any combination of both. Yet, it gets harder and harder to substitute more movies for an instructor the more movies are already used. Which graph in the above figure best represents the isoquants for lectures in microeconomics when capital per day is on the vertical axis and labor per day is on the horizontal axis?

Accepted Answer

Graph B represents isoquants that exhibit diminishing marginal rate of substitution, meaning that as more capital is substituted for labor, the amount of additional capital needed to maintain the same level of production decreases. This is in line with the statement that it gets harder to substitute more movies for an instructor the more movies are already used, indicating diminishing marginal productivity of capital.

Question 6

In the above figure, Graph D with Capital on the vertical axis and labor on the horizontal axis implies that

Accepted Answer

The answer of In the above figure, Graph D with...

Question 7

If marginal productivity is decreasing as more labor is hired, then average productivity must be decreasing as well.

Accepted Answer

The change in average productivity is not determined by the change in marginal productivity. Average productivity can be increasing even when marginal productivity is decreasing. Average productivity can only be decreasing when marginal productivity is below average productivity.

Question 8

Explain the difference between diminishing returns to labor and diminishing marginal returns to labor.

Accepted Answer

The answer of Explain the difference between diminishing returns to...

Question 9

-The above figure shows the short-run production function for Albert's Pretzels. The average productivity of labor when the firm employs five workers is

Accepted Answer

The answer of 
-The above figure shows the short-run production...

Question 10

-The above figure shows the short-run production function for Albert's Pretzels. Suppose the marginal productivity of labor for the sixth worker is 1. What is the total output produced by six workers?

Accepted Answer

The marginal productivity of labor for the sixth worker is the additional output produced by the sixth worker. Since it's 1, it means the total output produced by six workers is one more than the output produced by five workers. Without the specific output numbers for fewer workers, we can't directly calculate the total output for six workers from the information given. However, assuming the question implies we can deduce this information (as is common in theoretical questions), and given the choices provided, the correct answer would be to select an option as if we had enough information. Since the direct calculation approach isn't applicable without seeing the figure or having more data, any choice would be a guess. However, the correct approach in a real-world scenario would be to say it's not known from the information provided. But, given the nature of this setup, we proceed with the assumption that the total output for six workers is a specific number from the choices given, which is a misunderstanding of the setup here.

Question 11

Describe the relationship between marginal productivity and average productivity. Use calculus or a graph to support your answer.

Accepted Answer

The answer of Describe the relationship between marginal productivity and...

Question 12

-The above figure shows the short-run production function for Albert's Pretzels. Suppose the marginal productivity of labor for the seventh worker is 2. What is the average output per worker when Albert's Pretzels employs seven workers by six workers?

Accepted Answer

The answer of 
-The above figure shows the short-run production...

Question 13

Consider the following short-run production function: q = 5L² - 1/3 L³. At what level of L do diminishing marginal returns begin? At what level of L do diminishing returns begin?

Accepted Answer

The answer of Consider the following short-run production function: q...

Question 14

The actual time length of the short run is determined by when diminishing marginal returns start.

Accepted Answer

The actual time length of the short run is a function of how long it would take to adjust all inputs.

Question 15

Skateboards are produced according to the production function, q = 10K^0.25L^0.5 - L. Given that capital is fixed at 16 units in the short run, what quantity of labor is needed to produce 36 units of output?

Accepted Answer

Given the production function q = 10K^0.25L^0.5 and K = 16, to find L when q = 36, substitute q and K into the equation: 36 = 10(16)^0.25L^0.5. Solving for L gives L = 4.

Question 16

At low levels of production, marginal productivity of labor increases as labor increases. At high levels of production, marginal productivity of labor decreases as labor increases. Are these two statements contradictory? Explain.

Accepted Answer

The answer of At low levels of production, marginal productivity...

Question 17

-At Joey's Lawncutting Service, a lawn mower cannot cut grass without a laborer. A laborer cannot cut grass without a lawn mower. Which graph in the above figure best represents the isoquants for Joey's Lawncutting Service when capital per day is on the vertical axis and labor per day is on the horizontal axis?

Accepted Answer

The answer of 
-At Joey's Lawncutting Service, a lawn mower...

Question 18

A firm operating with diminishing total returns cannot be profit maximizing.

Accepted Answer

This firm could produce more output with fewer inputs. This cannot be profit maximizing.

Question 19

For a linear production function, q = f(L,K)= 4L + 2K, what is the short-run production function given that capital is fixed at  = 50?

Accepted Answer

The answer of For a linear production function, q =...

Question 20

Were it not for the law of diminishing marginal returns, we could grow the world's food supply from a flowerpot.

Accepted Answer

Given the current state of technology, the law of diminishing marginal returns limits the amount of additional output yielded from additional labor working the flowerpot. Revoking the "law" would allow output to increase at a non-decreasing rate when more labor is applied to the flowerpot.

Quiz 6: Firms and Production

Skateboards are produced according to the production function, q = 10K^0.25L^0.5 - L. At what quantity of labor does total product begin to decline given that capital is fixed at 16 units in the short-run?

Suppose the production function for T-shirts can be represented as q = L^0.25K^0.75. Show that the marginal productivity of labor diminishes in the short run.

In the above figure, Graph D with Capital on the vertical axis and labor on the horizontal axis implies that

If marginal productivity is decreasing as more labor is hired, then average productivity must be decreasing as well.

Explain the difference between diminishing returns to labor and diminishing marginal returns to labor.

-The above figure shows the short-run production function for Albert's Pretzels. The average productivity of labor when the firm employs five workers is

-The above figure shows the short-run production function for Albert's Pretzels. Suppose the marginal productivity of labor for the sixth worker is 1. What is the total output produced by six workers?

Describe the relationship between marginal productivity and average productivity. Use calculus or a graph to support your answer.

-The above figure shows the short-run production function for Albert's Pretzels. Suppose the marginal productivity of labor for the seventh worker is 2. What is the average output per worker when Albert's Pretzels employs seven workers by six workers?

Consider the following short-run production function: q = 5L² - 1/3 L³. At what level of L do diminishing marginal returns begin? At what level of L do diminishing returns begin?

The actual time length of the short run is determined by when diminishing marginal returns start.

Skateboards are produced according to the production function, q = 10K^0.25L^0.5 - L. Given that capital is fixed at 16 units in the short run, what quantity of labor is needed to produce 36 units of output?

At low levels of production, marginal productivity of labor increases as labor increases. At high levels of production, marginal productivity of labor decreases as labor increases. Are these two statements contradictory? Explain.

A firm operating with diminishing total returns cannot be profit maximizing.

For a linear production function, q = f(L,K) = 4L + 2K, what is the short-run production function given that capital is fixed at = 50?

Were it not for the law of diminishing marginal returns, we could grow the world's food supply from a flowerpot.

Quiz 6: Firms and Production

Skateboards are produced according to the production function, q = 10K0.25L0.5 - L. At what quantity of labor does total product begin to decline given that capital is fixed at 16 units in the short-run?

Suppose the production function for T-shirts can be represented as q = L0.25K0.75. Show that the marginal productivity of labor diminishes in the short run.

In the above figure, Graph D with Capital on the vertical axis and labor on the horizontal axis implies that

If marginal productivity is decreasing as more labor is hired, then average productivity must be decreasing as well.

Explain the difference between diminishing returns to labor and diminishing marginal returns to labor.

-The above figure shows the short-run production function for Albert's Pretzels. The average productivity of labor when the firm employs five workers is

-The above figure shows the short-run production function for Albert's Pretzels. Suppose the marginal productivity of labor for the sixth worker is 1. What is the total output produced by six workers?

Describe the relationship between marginal productivity and average productivity. Use calculus or a graph to support your answer.

-The above figure shows the short-run production function for Albert's Pretzels. Suppose the marginal productivity of labor for the seventh worker is 2. What is the average output per worker when Albert's Pretzels employs seven workers by six workers?

Consider the following short-run production function: q = 5L2 - 1/3 L3. At what level of L do diminishing marginal returns begin? At what level of L do diminishing returns begin?

The actual time length of the short run is determined by when diminishing marginal returns start.

Skateboards are produced according to the production function, q = 10K0.25L0.5 - L. Given that capital is fixed at 16 units in the short run, what quantity of labor is needed to produce 36 units of output?

At low levels of production, marginal productivity of labor increases as labor increases. At high levels of production, marginal productivity of labor decreases as labor increases. Are these two statements contradictory? Explain.

A firm operating with diminishing total returns cannot be profit maximizing.

For a linear production function, q = f(L,K) = 4L + 2K, what is the short-run production function given that capital is fixed at = 50?

Were it not for the law of diminishing marginal returns, we could grow the world's food supply from a flowerpot.

Skateboards are produced according to the production function, q = 10K^0.25L^0.5 - L. At what quantity of labor does total product begin to decline given that capital is fixed at 16 units in the short-run?

Suppose the production function for T-shirts can be represented as q = L^0.25K^0.75. Show that the marginal productivity of labor diminishes in the short run.

Consider the following short-run production function: q = 5L² - 1/3 L³. At what level of L do diminishing marginal returns begin? At what level of L do diminishing returns begin?

Skateboards are produced according to the production function, q = 10K^0.25L^0.5 - L. Given that capital is fixed at 16 units in the short run, what quantity of labor is needed to produce 36 units of output?