Suppose the Production Function for a Coffee Shop Is

question 30

Essay

Suppose the production function for a coffee shop is:
Q = 2K + 5L
where Q is the number of cups of coffee produced, K is the number of coffee makers, and L is the number of workers. Use calculus for the following:
a. to determine a function for the marginal product of labor
b. to determine a function for the marginal product of capital
c. to find the marginal rate of technical substitution
d. to discuss how MRTS_LK changes as the firm uses more labor, holding output constant

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Definitions:

Supplier Firms

Companies that provide goods or services to other businesses or customers within a supply chain.

Distributor Firms

Distributor firms are companies specialized in distributing products from manufacturers to retailers or directly to consumers.

Mass Production

The manufacture of large quantities of standardized products, often using assembly lines or automated technology.

Assembly Line

A manufacturing process in which parts are added to a product in a sequential manner to create a finished product efficiently.