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    Finding least-cost input-combination of labor and capital

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    Use the following data for a firm's output at various levels of employment (L) to calculate:

    Number of Workers (L) Output (Q)
    1 100
    2 300
    3 600
    4 850
    5 1000
    6 1100

    a) Its marginal physical product of labor (MPPL) schedule;

    (b) Its (MPPL/MRCL) schedule, given a fixed wage (W = MRCL) of $25 per hour per worker.

    (c) Assuming that capital (K) is held constant at 2 machines and MPPK/MRCK = 10, what is the least-cost input-combination of labor and capital and how much output is produced with that set of resources?

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    https://brainmass.com/economics/employment/finding-least-cost-input-combination-of-labor-and-capital-370607

    Solution Preview

    Please refer attached file for better clarity of formulas and tables.
    Solution:

    Use the following data for a firm's output at various levels of employment (L) to calculate:

    No. of workers (L) Output MPPL MPPL/MRCL MPPK/MRCK
    L Q Change in Q/change in L MMPL/$25
    1 100 100 ...

    Solution Summary

    Solution describes the steps to calculate least-cost input-combination of labor and capital.

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