Week 6 Managerial Economics. Order of Business Homework Assigned Lectures Other Material Lectures for Next Week.

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Presentation transcript:

Week 6 Managerial Economics

Order of Business Homework Assigned Lectures Other Material Lectures for Next Week

Homework

Find as many production isoquants as you can. That is, find as many points that lie on a particular production isoquant.

Does this production function have diminishing returns to proportion? Illustrate your answer with at least two examples. Compute the average product of labor when there are two thumpleblowers and 3 workers; compute the marginal product of a fourth worker

Does this production function have increasing returns to scale? Illustrate your answer with at least two examples.

Suppose a firm's cost function is C(q) = q + 5q 2. Compute TC, MC, AC and VC when q = 5

Using the data from the previous problem, determine what level of output minimizes AC? At that level of output, what is AC? MC?

I have two plants. One has a cost function C= q. The second plant has a cost function C = 15 + q + 0.5q 2. I want to produce 80 units of the product. How many should I produce at the first plant? At the second? Explain your answer.

Lectures for Last Week The Production Function The General Production Function Properties of Production Functions Basics of Cost Functions Mathematical Cost Functions Mathematical Cost Functions-2 Mathematical Cost Functions-3 Solving the Problem Properties of Cost Functions Applications of Cost Functions

The Production Function

The General Production Function

Properties of Production Functions

Basics of Cost Functions

Mathematical Cost Functions

Mathematical Cost Functions-2

Mathematical Cost Functions-3

Solving the Problem

Properties of Cost Functions

Applications of Cost Functions

Lectures for Next Week Basics of Competition The Firm's Supply Curve A Competitive Industry A Competitive Industry-More Changes in Factor Prices Equilibrium with Different Cost Functions Competitive Diversity Three Competition Problems Solution to Three Competition Problems

Basics of Competition

The Firm's Supply Curve

A Competitive Industry

A Competitive Industry-More

Changes in Factor Prices

Equilibrium with Different Cost Functions

Competitive Diversity

Three Competition Problems Solution to Three Competition Problems