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Unformatted text preview: + l ) = , with > and > . If q = q > and the rental rates for capital and labor are v > and w > respectively, solve for the derived demand for l and k . 4. Suppose that the total cost is C ( q ) = 10 + 2 q & 1 2 q 2 + 4 q 3 (a) Solve for marginal cost, MC ( q ) (b) Solve for average cost, AC ( q ) (c) Graph C ( q ) ;MC ( q ) , and AC ( q ) 5. Suppose that the price of hang-gliders for villians is p > . Oscorp&s production function for hang-gliders for villians is q ( l;k ) = ( l & k 1 & & ) , where & 2 (0 ; 1) and 2 (0 ; 1) . The cost per unit of l is w > and the cost per unit of k is v > . (a) Solve for Oscorp&s demand for l and k , and call these l and k . (b) How does l vary with i. p ii. & iii. w...
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- Spring '08