Author Question: In the short-run if there is a surplus in the market for a product, the rationing function of price ... (Read 67 times)

dalyningkenk · **on:** Jul 1, 2018

In the short-run if there is a surplus in the market for a product, the rationing function of price can be expected to cause

A) an increasing shift in the demand for the product.
B) a decreasing shift in the supply of the product.
C) an increase in the market price of the product.
D) a decrease in the market price of the product.

Question 2

The Cobb-Douglas production function for a beer manufacturer is q=1.52L0.6K0.4. Assume that the firm's capital is fixed at 250 units, the rental rate of capital is 5 per unit, and the wage rate is 10 per hour.

The amount of labor needed to produce q units of output is A) 0.0124q.
B) 13.832q0.6.
C) 0.0124q1.67.
D) 13.832q1.67.