Microeconomics Problems
QI. If pMP1 < rl , then should the firm increase or decrease the amount of capital 1, in order to increase profits? Q2. If a firm is producing where > —, what can it do to reduce costs but maintain the
rl
r2 same output?
Q3. A firm produces identical outputs at two different factories. If the marginal cost at the firstfactory exceeds the marginal cost at the 2nd factory, how can the firm reduce costs and maintain the same level of output?
Q4. A firm has a cost fc given by c(y) = 10y2 + 100. What is its supply curve?
Q5. A firm has a cost fc given by c(y) = 5y2 + 100. At what output is average cost minimized?
Q6. If the LR cost fc is c(y) = Y2 + 1, what is the LR supply curve of the firm?
