Question

A firm can manufacture a product according to the production function: Q = F(K, L) = K3/4L1/4. a. Calculate the average product of labor, APL, when the level of capital is fixed at 81 units and the firm uses 16 units of labor.

Answer 1

Answer:APL= 3.375

Step-by-step explanation:

PART 1. FIND Q=F(K,L)= K3/4 L1/4

K=81

L=16

PART 2 APL = Q/L

plug in the data

PART 1.

step 1. 81^3/4 or 81^.75 = 27

step 2. 16^1/4 or 16^.25 = 2

step 3. 27* 2 = 54 = Q

PART 2.

step 4. Q/L= 54/16 = 3.375

APL= 3.375

Answer 2

Answer: 15.1875

Explanation: k = 81 units L = 16 units

(81 × 3/4) × (16÷4) = 243

Q =243

APL = Q / L

243 ÷ 16 = 15.1875 units of labour