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Lecture 3_with ink - Economics 100B: Lecture 3 S. Nageeb...

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Economics 100B: Lecture 3 S. Nageeb Ali
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Economics 100B: Introduction and Ch. 6 Recap s Last time: b Short-run: MP L and AP L , MP always crosses AP at its peak. b Long-run: Isoquants, properties of isoquants, MRTS. s Today: b Calculating AP L when MP L hits non-negativity constraint. b Diminishing MRTS. b Economies of Scale b Handout s PS 1 has been posted on Webct. Solutions will be posted in 1 week. b TA will review Ch. 6 and go over PS 1 in the discussion section. b Best way to learn is to attempt these problems yourself first.
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Economics 100B: Introduction and Ch. 6 Production Function: Example q = 15L 2 – 2L 3
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Economics 100B: Introduction and Ch. 6 Substitutability
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Economics 100B: Introduction and Ch. 6 Marginal Rate of Technical Substitution (MRTS) s Slope of isoquant indicates how one input can be substituted for another MRTS indicates s while holding output constant s how many units of capital can be substituted s by additional unit of labor
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Economics 100B: Introduction and Ch. 6 MRTS
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Economics 100B: Introduction and Ch. 6
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Lecture 3_with ink - Economics 100B: Lecture 3 S. Nageeb...

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