What is the least-cost input combination for remodeling

Assignment Help Business Economics

Reference no: EM131076404

Suppose that the production function for Hannah and Sam’s home remodeling business is Q = F(L, K) = 10L0.2K0.3. If the wage rate is $1,500 per week and the cost of renting a unit of capital is $1,000 per week, what is the least-cost input combination for remodeling 100 square feet each week? What is the total cost? [HINT: you need to use the fact that under the given production function, MRTSLK = 2K/3L.]

Reference no: EM131076404

Questions Cloud

Movements in cross-exchange rates : Last year a dollar was equal to 7 Swedish kronor, and a Polish zloty was equal to $.40. Today, the dollar is equal to 8 Swedish kronor, and a Polish zloty is equal to $.44.

The first-order taylor series approximation : Consider an rv X with mean m and standard deviation s, and let g(X) be a specified function of X. The first-order Taylor series approximation to g(X) in the neighborhood of m is

Describe cost of the visit from the perspective of patient : A patient visits a clinic. He incurs $5 in travel costs and has a copayment of $25. The clinics total charge is $75. The clinic spends $10 to bill the insurance company for the visit and uses resources worth $45 to produce the visit. The insurance co..

What is the least-cost input combination for remodeling : Suppose that the production function for Hannah and Sam’s home remodeling business is Q = F(L, K) = 10L0.2K0.3. If the wage rate is $1,500 per week and the cost of renting a unit of capital is $1,000 per week, what is the least-cost input combination..

An exponential distribution with parameter : Let U have a uniform distribution on the interval [0, 1]. Then observed values having this distribution can be obtained from a computer's random number generator.

Computing the annuity interest rate : Your parents just called and would like some advice from you. An insurance agent just called them and offered them the opportunity to purchase an annuity for $14,217.56 that will pay them $2,500 per year for 15 years.

Write an inorder traversal algorithm for this array-based : Depict the array in an array-based implementation for the binary search tree in Figure 15-14 a of Chapter 15 . Assume that tree items are strings.

Npv-pi and irr calculations : Fijisawa, Inc. is considering a major expansion of its product line and has estimated the following cash flows associated with such an expansion. The initial outlay would be $1,960,000, and the project would generate cash flows of $380,000 per yea..

User Account

All Pages