Profit maximization, Microeconomics

Assignment Help:

Profits University creates student credit hours (y) with two inputs: Professors' hours of work (x1) and TAs' hours of work (x2) according to the manufacture function: f(x1,x2)= 10x1.5x2.25. Both inputs are variable. Suppose professors are paid $80 per hour and TAs are paid $2.50 per hour. Profits receive $40 per credit hour.

 (Profit maximization, both inputs variable)

a)  What is the expression for profits as a function of prices and inputs?

b)  What is the expression for revenue? For marginal revenue products of every of the inputs?

c)  Calculate the two first order conditions for profit maximization. What do they mean?

d)  Calculate the inputs and outputs that will maximize Profit's profits. What is the maximum profit that Profits can make?

 


Related Discussions:- Profit maximization

National budget, National Budget: A National Budget is a document show...

National Budget: A National Budget is a document showing estimates of expected government revenue and intended expenditure for the coming financial year. It usually consist of

Rational producer, would a rational producer be concerned with the average ...

would a rational producer be concerned with the average or marginal product of an input in dec

Elasticity, if you were making the pricing decision for the gasoline compan...

if you were making the pricing decision for the gasoline company, would you cut, raise or leae the price unchanged

represent the effect of an proportional tax on labor income, 1. Consider a...

1. Consider an individual facing a wage rate w . There's a total of 100 hours available for work or leisure in a week. (a) Represent his budget constraint graphically (b)

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