--%>
Assignment Help - homework help

Production function for the game

Question

Can you describe what the production function for the game looks like? (How are labour, capital and resources combined? Are there constant, increasing or decreasing returns to scale?)

Answer

The production function of the game is a fixed proportions production function. Let's first state directly from the rules about the requirements of production:

"A road costs one wood and one brick.

Cities cost three grain and two ore.

Settlements cost one brick, one wood, one grain and one sheep to build.

By paying one sheep, one grain, and one ore, a player can draw a card from the top of the development deck."

Here, we see that road costs one wood and one brick. Similarly, for cities, the input requirements are fixed. This reflects that the input requirements are fixed and specific. A road cannot with built by using wood only; it would require brick as well. Therefore, it is a fixed proportion production function.

There are constant returns to scale in this game, as the fixed proportion production function means that in order to build a city you need three grain and two ore and in order to build 3 cities, you need nine grain and six ore.

   Related Questions in Business Economics

  • Q : How demand is influenced by price

    Describe how the demand for a good is influenced by the price of its associated goods. Give illustrations.

    		•
  • Q : Speculation and intermediary operations

    Transaction costs tend to be decreased, prices to consumers are classically stabilized and lowered, and economy-wide efficiency is generally improved through: (1) rigid wage and price controls. (2) central planning that fosters monopo

    		•
  • Q : Illustrate Other Things Equal revisited

    Illustrate “Other Things Equal” Revisited in Supply and Demand, and Equilibrium?

    		•
  • Q : Illustrate the Law of supply Illustrate

    Illustrate the Law of supply?

    		•
  • Q : Other things equal assumption helps

    Explain the statement: “The other things equal assumption helps isolate key economic relationships.”?

    		•
  • Q : Meaning of Economic Development

    Question Discuss what "economic development" means in the context of this game? (Hint: How do you win, and what do you have at the end of the game that you did not have at the beginning of the game?)

  • Q : Larger amount is actually purchased at

    Critically evaluate:  “In comparing the two equilibrium positions, it note that a larger amount is actually purchased at a higher price. This disprove the law of demand.”

    		•
  • Q : What happens in the resource markets

    What happens in the resource markets?

    		•
  • Q : Raising consumer surplus problem For

    For the question below, utilize the given information. The market for gizmos is competitive, with an increasing sloping supply curve and a downward sloping demand curve. With no govt. intervention, the equilibrium price is $25 and the equilibrium quantity is 10,000 gi

    		•
  • Q : Best alternatives while choices are made

    Opportunity costs, which are the values of the: (i) monetary costs of goods and services. (ii) best alternatives sacrificed while choices are made. (iii) minimal budgets of families upon welfare. (iv) hidden charges passed upon to consumers. (v) exorb

    		•