Question

3. Frisbees are produced according to the production function q = 2K+L
where q =output of frisbees per hour, K =capital input per hour, L =labor
input per hour.
a) If K = 10, how much L is needed to produce 100 frisbees per hour?
b) If K = 25, how much L is needed to produce 100 frisbees per hour?
c) Graph the q = 100 isoquant. Indicate the points on that isoquant
deÖned in part a and part b. What is the RTS along this isoquant? Explain
why the RTS is the same at every point on the isoquant.
d) Graph the q = 50 and q = 200 isoquants for this production function
also. Describe the shape of the entire isoquant map.
e) Suppose technical progress resulted in the production function for
frisbees becoming q = 3K + 1:5L. Answer part a through part d for this
new production function and discuss how it compares to the previous case.

Answer 1