Calculate the productivity of Employment
For the quantitatively inclined champions of youth employment we are
delineating the formulae which can assist you to calculate the marginal
productivity of employment:
1. Consider the following production function
q=4N?where q is output, N is employment and 0<?<1 is a constant. Calculate
the marginal productivity of employment for N =100 and N=1000. Compare the
marginal productivity in the two cases. What do you observe? How does your
result change if ?>1?
2. Suppose that income in country C increases by a yearly rate k. Suppose
that population increases at a yearly rate p. Under which condition does
income per capita increase in country C?
3. Suppose that totals costs (TC) faced by a firm producing a certain output
q is the sum of variable costs (VC) and fixed costs (FC). Let VC=20q2 - 7q
FC= 80
i. Determine the average and marginal cost for the firm
ii. Suppose fixed costs increase by 30%. How are marginal and average costs
affected?
4. Suppose that the utility accruing to a consumer from the consumption of C
units of a good is: U(C)=(C2+1)1/2
Determine the marginal utility of consumption. Compare the marginal utility
for an endowment C=10 and C=11.
We really look forward to some calculations from you.
Regards
Tony
Moderator
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