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Question 27

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Subject
Economics
School
saint marys university
Type
Homework
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Question 27 (10 points)
Assume that fruit picking can be done by children or adults, but that adults are twice as
efficient as children (they pick twice as fast). The production function for fruit picking is thus
Q= 10 X (2L
A
+ L
C
) where output is measured in bushels of apples, labour is measured in days
and L
A
is the number of days of adult labour, and L
C
is the number of days of child labour.
A. Depict the isoquants for a typical orchard (in terms of fruit-picking)
Q = 10(2La + Lc)
B. Assume the wage rate of adults is $100 per day, and the wage for children is $60 per day. Show
the isocost lines.
Wa = $100
Wc = $60
Cost = WaLa + WcLc
Cost = 100La + 60Lc
2
1
½
1
0
Q=20
Number of days of adult labour
Isoquants
½
5
0
3
6
Cost = 100
Cost = 600
Isocost
number
of days of
child
labour
Number of days of adult labour

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Question 27 (10 points) Assume that fruit picking can be done by children or adults, but that adults are twice as efficient as children (they pick twice as fast). The production function for fruit picking is thus Q= 10 X (2LA + LC ) where output is measured in bushels of apples, labour is measured i ...
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