The production function for the personal computers of DISK, Inc., is given by q = 10K^(0.5)L^(0.5)
where q is the number of computers produced per day, K is hours of machine time, and L is hours of labor input. DISK’s competitor, FLOPPY, Inc., is using the production function
q = 10K^(0.6)L^(0.4)
a. If both companies use the same amounts of capital and labor, which will generate more output?
b. Assume that capital is limited to 9 machine hours, but labor is unlimited in supply. In which company is the marginal product of labor greater? Explain.
c. Is there a maximum quantity that each firm can produce under fixed capital (from b)? If so, what is it?

Lipman auto parts, a family-owned auto parts store, began january with $10,300.00 in cash. management forecasts that collections from credit customers will be $11,400.00 in january and $14,800.00 in february. the store is scheduled to receive $5,000.00 in cash on a business note receivable in january. projected cash payments include inventory purchases ($13,000.00 in january and $13,600.00 in february) and operating expenses ($2,700.00 each month). lipman auto parts' bank requires a $10,000.00 minimum balance in the store's checking account. at the end of any month when the account balance dips below $10,000.00, the bank automatically extends credit to the store in multiples of $1,000.00. lipman auto parts borrows as little as possible and pays back loans in quarterly installments of $2,000.00, plus 4 percent interest on the entire unpaid principal. the first payment occurs three months after the loan.