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(Solution document) answer is a, can you show me the steps in solving?


answer is a, can you show me the steps in solving?


An industry has 100 firms. These firms have identical production functions. In the short run, each firm has fixed costs of $400. There are two variable factors in the short run and output is given by y= (min(x1,4x2))1/2 .The cost of factor 1 is $4 per unit and the cost of factor 2 is $2 per unit. In the short run, the industry supply curve is given by:


(a)Q= 100p/9


(b)Q= 100p/8


(c)Q= 600p1/2


(d) the part of the line Q= 50(min(4,8)) for which pQ >400/Q


(e)None of the above.

 







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