1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
RSB [31]
2 years ago
10

Consider a firm which produces T-shirts according to Q = L^0.5, where Q denotes output and L is labor input. The domestic wage i

s w = 2. The firm can sell its output for a given price of p = 1.
(a) Determine the profit-maximizing labor input and the profit of the firm.
Business
1 answer:
Luden [163]2 years ago
4 0

From the calculation below, the profit-maximizing labor input is 0.0625, and the profit of the firm is 0.125.

<h3>How do we determine profit-maximizing labor input and profit?</h3>

From the question, we can obtain:

R = Revenue = Q*P = L^0.5 * 1 = L^0.5

C = Cost = w * L = 2L

P = Profit = R - C = L^0.5 - 2L

To obtain the profit-maximizing labor input, the first derivative of P is taken, equated to zero, and we solve for L as follows:

P' = 0.5L^-0.5 - 2 = 0

0.5L^-0.5 = 2

L^-0.5 = 2 / 0.5

L^-0.5 = 4

L^(-0.5/-0.5) = 4^(-1/0.5)

L = 0.0625 ----> profit-maximizing labor input

The profit (P) of the firm can now be calculated by substituting L = 0.0625 into the P function as follows:

P =  0.0625^0.5 - (2 * 0.0625) = 0.125 --------> Profit of the firm

Learn more about profit function here: brainly.com/question/16866047.

#SPJ1

You might be interested in
You are preparing a presentation on networking for a professional development seminar that your company is hosting for its emplo
BaLLatris [955]

Answer:

A

Explanation:

Any pattern particularly with audience involvement

Having a friendly audience, any organizational pattern will be appropriate. Using the audience’s familiarity will be to your advantage and that will help you to get them involved with you the presentation. Being warm, pleasant, and open, and using lots of eye contact. Includeing humor and personal experiences in your presentation will make the experience a memorable one.

6 0
3 years ago
When is a liability considered "current"?
MrRa [10]
B. When it is due to be paid within one year.
6 0
3 years ago
Guiness Inc. has a budgeted production of 8,000 units. Each unit requires 40 minutes of direct labor work to complete. The direc
Alex Ar [27]

<u>Solution and Explanation:</u>

The budgeted cost of the direct labor for the month is calcuated as follows:

the given data:

Budgeted production is = 8000 units, time required of direct labor work in order to complete the production is = 40 minutes, the direct labor rate as given in the question is = $100 per hour.

Budgeted cost = time multply with rate of labor multiply with budgeted production

(40/60 multiply with 100) multiply with 8000 = 533,333.33

therefore, the budgeted cost = $533333.33 ( rounded of to 2 places).

6 0
3 years ago
Rent is $1,258. Phone charges last month were $46.88. Groceries cost about $115/week. What is a good estimate of your monthly ex
Papessa [141]

I'd say $1,807.00 (C)

6 0
3 years ago
Piechocki Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets
nadya68 [22]

Answer:

$ 49,640

Explanation:

The question is asking for PLANNING BUDGET

Planning Budget does not in anyway mean flexible budget.

So the quantity of units for Planning Budget would be what the company budgeted that is 7,300 units

The next step in the solution to the question will be to know the cost per unit. For Direct Labor the price given is $ 6.80 per unit

Total Direct Labor for May in the planning budget would be 7,300 X 6.80 = $ 49,640

6 0
3 years ago
Other questions:
  • N article published in the washington post claims that 45 percent of all americans have brown eyes. a random sample of n=78 coll
    15·1 answer
  • How much education or training do you need for a airline pilot study.com?
    10·1 answer
  • What is a possible reason a company would sell stock
    15·2 answers
  • The minimum acceptable price for a product that producer Sam is willing to receive is $15. The price he could get for the produc
    10·1 answer
  • A wide span of management control is most likely to result in: A. overly tight supervision of employees. B. isolation of top man
    9·1 answer
  • The sales-volume variance equals:
    14·2 answers
  • Last year ABC Media had $425 million of sales, and it had $270 million of fixed assets that were used at 65% of capacity. In mil
    5·1 answer
  • what is referred to a process that involves developed action plan that leads to achieving specific goals​
    11·1 answer
  • Madison Corporation purchased 40% of Jay Corporation for $400,000 on January 1. On June 20 of the same year, Jay Corporation dec
    14·1 answer
  • Annuities where the payments occur at the end of each time period are called _____, whereas _____ refer to annuity streams with
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!