Exam 6: Production

The production function for Cogswell Cogs is K represents the number of robot hours used in the production process while L represents the number of labor hours. The marginal productivity of a labor hour is Fill in the empty columns in the table below. Use the information in the table to sketch Cogswell's marginal product of labor curve while robot hours are fixed at 9.

If we take the production function and hold the level of output constant, allowing the amounts of capital and labor to vary, the curve that is traced out is called:

A farmer uses M units of machinery and L hours of labor to produce C tons of corn, with the following production function This production function exhibits:

You are given the following table for a production process which has two variable outputs. a. Sketch the isoquants corresponding to the following output levels: 60, 70, 85, 95, 105, and 115. What returns to scale does the production function exhibit? What can be said of the MRTS? b. Analyze the marginal productivity of labor and capital for the production function.

The link between the productivity of labor and the standard of living is:

Apu's Squishy production function is where K is the number of squishy machines and L is the number of labor hours he employs. Does this production function exhibit increasing, decreasing or constant returns to scale? At the moment, Apu uses 2 squishy machines and 4 labor hours. Suppose that Apu can use any amount of either input without affecting the market costs of the inputs. If Apu increased his use of labor hours and squishy machines by 100%, how much would his production increase? Increasing the use of both inputs by 100% will result in Apu's costs increasing by exactly 100%. If Apu increases his use of all inputs by 100%, what will increase more his production or his costs? Given that Apu can sell as many squishies as he produces for $1.00, do his profits go up or down when he increases his input use by 100%?

An upward sloping isoquant:

Wally describes himself as a resilient fundamentalist when it comes to making investments in the stock market. At the moment, Wally uses only periodicals from the library when analyzing corporate fundamentals. The number of firms he can analyze in a day is given by the function: where L is the number of hours a day he works. Sketch Wally's total number of firms analyzed as he increases his hours of work. If Wally begins using Internet sources to learn about corporate fundamentals, the number of firms he can analyze in a day is given by the function: Sketch Wally's total number of firms analyzed as he increases his hours of work and uses the Internet.

Use the following two statements to answer this question: I. If the marginal product of labor is zero, the total product of labor is at its maximum. II If the marginal product of labor is at its maximum, the average product of labor is falling.

An L-shaped isoquant:

What describes the graphical relationship between average product and marginal product?

A production function defines the output that can be produced:

You operate a car detailing business with a fixed amount of machinery (capital), but you have recently altered the number of workers that you employ per hour. Three employees can generate an average product of 4 cars per person in each hour, and five employees can generate an average product of 3 cars per person in each hour. What is the marginal product of labor as you increase the labor from three to five employees?

Leann's Telecommunication firm production function is given by where K is the number of internet servers and L is the number of labor hours she uses. Does this production function exhibit increasing, constant or decreasing returns to scale? Holding the number of internet servers constant at 8, is the marginal product of labor increasing, constant or decreasing as more labor is used?

Which of the following is NOT related to the slope of isoquants?

For consideration of such issues as labor's productivity growth nationwide, the relevant measure is the:

A firm's marginal product of labor is 4 and its marginal product of capital is 5. If the firm adds one unit of labor, but does not want its output quantity to change, the firm should:

If capital is measured on the vertical axis and labor is measured on the horizontal axis, the slope of an isoquant can be interpreted as the:

Figure 6.4.1 -Refer to Figure 6.4.1 above. According to the diagram below, where each isoquant's output level is marked to the right of the isoquant, production is characterized by:

Does it make sense to consider the returns to scale of a production function in the short run?