Economics - Cost Projects

PROJECT 2 1.) Determine the minimum cost production mix for the following set of isoquants (equal production

PROJECT 2

1.) Determine the minimum cost production mix for the following set of isoquants (equal production levels) and labor and capital -combinations.

Quantity Labor Capital Price of Labor Price of Capital
10 50 30 $12/unit $190/unit
10 30 45 8/unit 200/unit
10 15 50 7/unit 215/unit
20 170 35 $18/unit $195/unit
20 120 45 12/unit 200/unit
20 30 65 8/unit 220/unit
30 300 40 $25/unit $195/unit
30 150 60 15/unit 215/unit
30 100 75 12/unit 230/unit
40 600 40 $35/unit $195/unit
40 300 65 25/unit 220/unit
40 150 90 15/unit 235/unit

2.) A cost function, as a function of quantity produced, is:

\[C=5000+23q+.6{{q}^{2}}+600t\]

Where C is the cost, q is the quantity produced, and t is a time trend.

a.) What are the fixed and variable costs?

\[VC=23q+0.6{{q}^{2}}\]

b.) Determine the marginal cost function.

3.) Determine the cost per period of producing 50 units per period for the next five periods. These periods are 21 through 25.

Price: $4.62
Solution: The downloadable solution consists of 3 pages, 162 words.
Deliverable: Word Document



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