question archive Consider a firm with the production function f(K,L)=(K1/4)(L2/4)
Consider a firm with the production function f(K,L)=(K1/4)(L2/4)
Subject:EconomicsPrice: Bought3
Consider a firm with the production function f(K,L)=(K1/4)(L2/4).
In the short run, the firm has rented 25 units of capital. The firm is a price taker in both the output market and labor market, facing an output price of 11 and a market wage of 9 per hour. Rounded to the nearest tenth, how many hours of labor will the firm hire?
Suppose that over the long run, the firm's use of capital increases to 36 units. If the wage and output price remain constant, will this lead to an increase, a decrease, or no change in the quantity of labor demanded by the firm?
Group of answer choices
A)Decrease
B) Increase
c)No Change
