The following production table provides estimates of the maximum amounts of output possible with different combinations of two input factors, X and Y. (Assume these are just illustrative points on a spectrum of continuous input combinations.)
Estimated Output per Day
|
5
|
184
|
265
|
334
|
395
|
440
|
|
4
|
176
|
248
|
303
|
352
|
395
|
|
3
|
164
|
216
|
264
|
303
|
334
|
|
2
|
128
|
176
|
216
|
248
|
265
|
|
1
|
88
|
128
|
164
|
176
|
184
|
|
|
1
|
2
|
3
|
4
|
5
|
a. List the different combinations of inputs X and Y that, if graphed, would illustrate an isoquant for an output of 176.
b. Assuming that output sells for $3 per unit and X is fixed at 5 units, complete the following table:
|
Units of Y employed
|
Total Product
Of Y
|
Marginal Product of Y
|
Value Marginal Product of Y
|
|
1
|
184
|
184
|
|
|
2
|
|
|
|
|
3
|
|
69
|
|
|
4
|
|
|
183
|
|
5
|
440
|
|
|
c. Assuming the cost of Y is $200 per unit, how many units of Y should optimally be employed? Explain how you reached your answer.
d. Suppose that the cost of units of both input X and input Y are the same at $200 per day. Describe how isocost curves for a cost of $200 and also for a cost of $270 would look in terms of position and slope.