I. DEMAND THEORY
1. The estimated regression of demand for x is as follow:
QX = 121,86 – 9,50 PX + 0,04 I – 2,21PZ
(-5,12) (2,18) (-0,68)
R2 = 0,9633 F = 167,33
QX = Demand of x.
PX = Price of x.
I = Income.
PZ = Price of z.
a) Evaluate the estimated regression above whether it is statistically significance or not using this information, such as: critical value of t-table with α = 5% is 2,110 and F-table is 3,59.
b) Explain the meaning of coefficient of determination (R2) above.
c) Explain why PZ include to this equation of regression? What is Z? Explain.
II. PRODUCTION THEORY – SHORT RUN
2. Table of Total, Marginal, and Average Product of Labor, and Output Elasticity.
(1) (2) (3) (4) (5)
Labor Total Product (TP) Marginal Product (MPL) Average Product (APL) Output Elasticity of Labor
0123456 03812141412 ……………………………………………………… ……………………………………………………… ………………………………………………………
a) Fill in column 3, 4 5.
b) What is the value of Output Elasticity of Labor when using 2 labors to produce output? Explain the meaning of this coefficient of elasticity.
c) Draw the figure of TP, APL, MPL curves.
d) Explain about law of diminishing returns. What is the value of MPL when law of diminishing return starts to happen?
3.
a) Give definition of Isoquant and draw the curve.
b) Using figure 3a, explain about Marginal Rate of Technical Substitution of capital to labor (MRTS) briefly, and why the value of MRTS will get smaller together with the decreasing of Isoquant from up left to bottom right? Explain clearly.
c) Explain the meaning of capital and labor are perfect substitution, and draw the curve.
d) Explain the meaning of capital and labor are perfect complementary, and draw the curve.
4. Rifki, owner and manager of printings and Photocopy Company near STEKPI plans to expand his business until 8 pm at night because his customers increase. Therefore he will hire more employees. Price of his output is $ 10 per unit, and salary of each labor is $ 40 per a day.
a) Fill in the table below.
b) Explain about condition of maximum profit theoretically (about the producer’s equilibrium) using the concept of MRPL and MCL , and draw the curves.
c) Using the table below, how many labors will be employed in order to reach maximum profit?
Units of Labor Total Product (TP) Marginal Product of Labor (MPL) Marginal Revenue=Price (MR=P) Marginal Revenue of Product (MRPL) Marginal Cost=Wage (MC=w)
0123456 0122230364042 …….…….…….…….…….…….……. …….…….…….…….…….…….……. …….…….…….…….…….…….……. …….…….…….…….…….…….…….
III. PRODUCTION THEORY – LONG RUN
5. The estimated Cobb-Douglas production function is Q = 10 K 0,6L 0,8
Q = quantities of output; K = capital; L = labor.
a) What is the value of output elasticities of capital and labor? Explain the meaning of each elasticity.
b) What is definition of Return to Scale, how many classification of the scale, explain each of scale using the figure/curves.
c) What kind of return to scale of Cobb-Douglas production function above. Explain.
d) Bila nilai modal dan tenaga kerja yang digunakan perusahaan dalam memproduksi barang adalah sama, yaitu $ 1000, berapa nilai output yang akan diproduksi?
