Completed quickly and followed instructions given. Grammar, spelling, etc. was all good as well. Thank you so much! Will hire in the future.
1. Green is looking to establish a new market producing energy gummy bears. After intensive research Green has found the production function is given by q = 75K1/3L2/3, where q is thousands of pounds of energy gummy bears, known as GreenergiesTM, K is capital, L is labor, r is the price of capital, w is the price of labor, and q is per year.
a. Find K and L as a function of r, w and q.
b. Use K(r, w, q) and L(r, w, q) to find the long-run cost function C(q). Discuss why someone might want to know this functional relationship.
c. What returns to scale does C(q) exhibit? How do you know and why might the long-run returns to scale make sense in this case?
d. The price of capital is given by r = $100,000, the wage is w = $25,000, and market research indicates that the market will support q = 300. What are the optimal levels of K and L?
e. What is the cost of producing q = 300 units of output?
f. Suppose Green invests in the optimal level of capital, find the short-run production function?
g. What are the functional forms of the short-run variable costs, total cost, marginal cost, average cost, and average variable cost functions?
h. What is the conceptual difference between the long-run and short-run total cost functions?
i. What are the short-run break-even quantity and price, qE and pE?
j. How much will Green produce if the price is $1,500?
k. Is the energy gummy market in long run equilibrium when p = $1,500? Show your work and explain.
l. Suppose w decreases to $22,000, what are the new qE, pE and LE?
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.
Read moreEach paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.
Read moreThanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.
Read moreYour email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.
Read moreBy sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.
Read more