Answer:
a. Compute the output if the capital investment is $125,000 and the size of the labor force is 1,331 worker-hours.
Q(K, L) = 120K²/³ x L¹/³
Q(125,1331) = 120 x 125²/³ x 1331¹/³ = 120 x 25 x 11 = 33,000 units
b. What will happen to the output in part (a) if both the level of capital investment and the size of the labor force are cut in half
Q(K, L) = 120K²/³ x L¹/³
Q(62.5,665.5) = 120 x 62.5²/³ x 665.5¹/³ = 120 x 15.75 x 8.73 = 16,499.7 units
To solve the problem, substitute the given values for capital and labor into the function equation to find the output. Then, cut those values in half and do the process again to establish how the output changes.
To solve this problem, first we must understand the function provided: Q(K, L) = 120K^2/3 L^1/3. In this function, Q is output, K is capital investment, and L is labor force.
For part (a), we substitute K with 125 (since K is in units of $1000 and capital investment is $125,000), and L with 1331:
Q(125,1331) = 120(125)^2/3 (1331)^1/3
Solve this equation to find Q, which is the output.
For part (b), if both capital and labor are cut in half, we substitute K with 62.5 and L with 665.5 into the equation, and solve for Q again to find out how the output changes:
Q(62.5,665.5) = 120(62.5)^2/3 (665.5)^1/3
Finding the solutions to these calculations will provide you with the answers to both parts of your problem.
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b. machines
c. buildings
d. tools
Answer:
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Explanation:
B. demand.
C. the Law of Supply.
D. supply.
Consumer tastes or preferences most directly impact demand, as it is driven by consumer behavior. Their preferences may also indirectly influence supply and elasticity, with changes leading to shifts in production or affecting how price changes impact demand.
Consumer tastes or preferences are most likely to have an effect on B. demand. This is due to the basic economic principle that demand is driven by consumer behavior. If consumers prefer a particular product or service, demand for that product or service will increase. On the other hand, if consumers' preferences change and they no longer want a particular product or service, demand will decrease.
Although consumer preferences could indirectly influence supply and elasticity, the most direct impact is on demand. In terms of supply, if consumers' preferences shift towards a specific product, it may prompt manufacturers to increase production, which would increase the supply. As for elasticity, when there is a strong preference or need for a product, its demand tends to be inelastic, as changes in price have less effect on the quantity demanded.
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