User Account

All Pages

How much will the firm produce at the market price

Assignment Help Microeconomics
Reference no: EM13964571

1. A firm estimates its cubic production function of the following form: Q = AL^3 +BL^2 and obtains the following results:

Dependent VARIABLE Q R-SQUARE F-RATIO P-VALUE ON F

OBSERVATIONS 32 0.7547 92.31 0.0001

VARIABLE PARAMETER ESTIMATE STANDARD ERROR T-RATIO P-VALUE

L3 -0.0016 0.0005 -3.2 0.0032

L2 0.4 0.095 4.21 0.0002

a. Based on the estimation results, write thee equations for total product, average product, and marginal product curves:

b.The estimated values of A and B are statistically significant at exact what level of significance? (use the p-value)

c. Find the level of labor at which the average product of labor reaches its maximum value.

2. Suppose the short-run production function for a particular product is represented by:

Q = 60,000L2 - 1,000L3

a. Find the marginal product and show mathematically that labor is subject to diminishing returns.

b. Beyond what labor usage, the marginal product becomes negative.

c. Show mathematically that when the average product is at maximum, marginal product is equal to it?

Assume Caspian is a firm operating in a competitive market. The estimated its average variable cost function is shown below: AVC = A + BQ + CQ2

The total fixed cost (TFC) = $1,000.

Dependent VARIABLE AVC R-SQUARE F-RATIO P-VALUE ON F

OBSERVATIONS 35 0.8713 108.3 0.0001

VARIABLE PARAMETER ESTIMATE STANDARD ERROR T-RATIO P-VALUE

INTERCEPT 43.4 13.8 3.14 0.0036

Q -2.8 0.9 -3.11 0.0039

Q2 0.2 0.05 4 0.0004

a. Are the estimated coefficients statistically significant at the 5% level of significance?

b. Find the total cost function.

c. Find the equation for the ATC. Is it U-shaped? A simple yes/no is not enough. Use math.

d. Find the shut-down price.

e. How much will the firm produce at the market price of $53.4?

Reference no: EM13964571

Questions Cloud

Determine the rate of heat transfer through the wall : On the outside of the wall, the convection heat transfer coefficient is 6 Btu/h-ft^2-R degrees and the air temperature is -10 degrees F. Ignoring radiation, determine the rate of heat transfer through the wall at steady-state in Btu/h
Determine the profit maximizing output for bartech : Bartech expects to face fixed costs of $12,000 in 2010. Determine the firm's supply curve. Determine the profit maximizing (or loss minimizing) output for Bartech, given that P = $28.
Formula and the old one are equally effective : A company's sold antacid formula provided relief for 70% of the people who used it. The company's tests a new formula to see if it is better and gets a P-value of 0.27. Is it reasonable to conclude that the new formula and the old one are equally ..
Determine the average temperature rise of the remains of car : determine the average temperature rise of the remains of the cars
How much will the firm produce at the market price : Find the equation for the ATC. Is it U-shaped? A simple yes/no is not enough. Use math. Find the shut-down price. How much will the firm produce at the market price of $53.4?
Calculate the resonant frequency : Calculate the total impedance Z for above circuit for ω= 2Π525 rad/sec ( f = 525 hz). For the bove mentioned series RCL circuit, if V = 120cos(2Π525t). Given Vo =120 volt, what is the value of Io = Vo/Z ?
What is the total cost of producing hundred units of output : What input combination should it choose to minimize its total cost given that w = r = $10? What is the total cost of producing 100 units of output?
Determine the heat supplied to the sir in the heat exchanger : Assuming the air in the heat exchanger acts as a heat sink having an average temperature of 25°C, determine the minimum power supplied to the heat pump, in kW
Determine the profit maximizing quantity of labor : The firm sells its product at $100 in a competitive market and can hire labor at a constant rate of wage of $50 per unit of time. Capital is fixed at 8,000 units. Determine the profit maximizing quantity of labor (L).

Reviews

Write a Review

Microeconomics Questions & Answers

  Explain how and why firms practice 3rd degree price

Explain how and why firms practice 3rd degree price discrimination. Use the handout to illustrate your answer (coupons; airlines, mobile phones).

  Estimate financial performance of company using information

assume you have been hired as a managing consultant by a company to offer some advice that will help it make a decision

  Calculate price index numbers

8. Julia's publisher sends her a $15,000 check every year that her book is in print. Suppose Julia's book is in print for five years and the inflation rate during that period is (-2) percent.

  Is the automobile industry in the united states competitive

"Is the automobile industry in the United States competitive? Try to answer this question considering the recent trends in the automobile industry around the world." Discuss.

  What types of monetary policy did the federal reserve

Normal 0 false false false EN-US X-NONE X-NONE What types of monetary po..

  1 tell how they combine to insure that in the long run a

1 tell how they combine to insure that in the long run a firm in a perfectly compitive industry make zero profit and is

  Tax position of the taxpayer likely to change

In the following independent situations, is the tax position of the taxpayer likely to change? Explain why or why not. John used to make casual purchases and sales of real estate as an investor. Currently, he does so on a regular basis and has obtain..

  A number of strategies have been put in place to reduce

a number of strategies have been put in place to reduce alcohol-related harm by reducing the average consumption of

  What price maximizes profits

Dispose of the extrusion machine. The company could keep it in inventory for a possible future product and estimates that the reservation value is $250,000.

  Find the area under the standard normal curve between

If the probability of a newborn child bieng female is 0.5, find the probability that in 100 births, 55 or more will be female.Use the normal distribution to approximate the binomial distribution.

  Which outcome is the nash equilibrium in game

Identify the choice that best completes the statement or answers the question and table shows a game played between two players, A and B. The payoffs in the table are shown as (Payoff to A, Payoff to B).

  How did the simulation show the use of monetary policy

1 . Based on the game, how did the simulation show the use of monetary policy to control both unemployment and inflation? How do Federal Funds Rate affect unemployment and inflation based on your experience with the game?

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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