ARME608 MID TERM EXAM 1999 - then as a function of an input...

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ARME 608 First Exam Fall 1999 1) Derive the supply function and conditional demand functions for a firm with the cost function: C=y 2 * (r 1 *r 2 ) 1/2 (where y is output and r i is an input price) 2) A Cobb-Douglas variable profit function is written where one input is variable and a second input is fixed (but varies across observations). There is one output. Write out the function you would estimate. How could you determine the value of the fixed input to the producer? 3) Graphically show both short-run and long-run profit as a function of output price and
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Unformatted text preview: then as a function of an input price. 4) A farmer has a fixed quantity of an input that can be allocated to the production of two separate outputs y 1 and y 2 . In addition, another variable input can be used that jointly effects the production of both y 1 and y 2 . Mathematically set up the decision for a profit maximizing farmer. Derive and interpret the first order conditions....
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This note was uploaded on 08/25/2010 for the course ECONOMICS 408 at Cornell University (Engineering School).

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