HW chap 7

Firstnotethat

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: 08­09­2011 Section: Production with Two Variable Inputs Worksheet Suppose that John, April, and Tristan have two production plants for producing orange juice. They have a total of 1000 crates of oranges. The marginal product of oranges in plant 1 is and in plant 2 is What is the best assignment of oranges between the two plants? Instructions: Enter your answers as whole numbers. Plant 1 should use oranges. 475 crates of oranges in production and plant 2 should use 525 crates of rev is ed jrl 08­09­2011 Explanation: John, April, and Tristan should produce at their two plants such that the plants' marginal products are equal. If instead one plant were to have a higher marginal product than the other, then oranges should be transferred from the plant with the lower marginal product to the plant with the higher marginal productivity. First, note that: Then, set the marginal products of the two plants equal to each other: Substituting 1000 – O2 for O1 and solving for O2 : Hence: http://e z to.mhe c loud.mc gr a w- hill.c om/hm.tpx? todo= pr intvie w 3/7 1/21/2014 13. Assignme nt Pr int Vie w awar d: 5 out of 5.00 points Beta Inc. has two production plants that use finely divisible labor to produce its output. The marginal product of labor at plant 1 is and the marginal product of labor at plant 2 is Beta Inc. wants to find the best assignment of 120 workers between the two plants. What is it? Instructions: Enter your answers as whole numbers. Beta Inc. should assign 100 workers to plant 1 and 20 workers to plant 2. rev is ed jrl 08­09­2011 Section: Production with One Variable Input Worksheet Beta Inc. has tw...
View Full Document

Ask a homework question - tutors are online