tailieunhanh - Tài liệu trung cấp môn Kinh tế vi mô bằng tiếng Anh - Phần 21

Tài liệu tham khảo Tài liệu trung cấp môn Kinh tế vi mô bằng tiếng Anh gồm 41 phần giúp sinh viên khoa kinh tế học tốt môn Kinh tế vi mô. Tài liệu này là phần 21 giới thiệu về " Cost minimization " | CHAPTER 20 COST MINIMIZATION Our goal is to study the behavior of profit-maximizing firms in both competitive and noncompetitive market environments. In the last chapter we began our investigation of profit-maximizing behavior in a competitive environment by examining the profit-maximization problem directly. However some important insights can be gained through a more indirect approach. Our strategy will be to break up the profit-maximization problem into two pieces. First we will look at the problem of how to minimize the costs of producing any given level of output and then we will look at how to choose the most profitable level of output. In this chapter we ll look at the first step minimizing the costs of producing a given level of output. Cost Minimization Suppose that we have two factors of production that have prices and W2 and that we want to figure out the cheapest way to produce a given level of output y. If we let Xi and X2 measure the amounts used of the 354 COST MINIMIZATION Ch. 20 two factors and let be the production function for the firm we can write this problem as min wixi H- W2X2 X 1 X2 such that xi X2 y. The same warnings apply as in the preceding chapter concerning this sort of analysis make sure that you have included all costs of production in the calculation of costs and make sure that everything is being measured on a compatible time scale. The solution to this cost-minimization problem the minimum costs necessary to achieve the desired level of output will depend on wi w2 and y so we write it as c wi W2 v - This function is known as the cost function and will be of considerable interest to us. The cost function c wi w2 y measures the minimal costs of producing y units of output when factor prices are wi w2 . In order to understand the solution to this problem let us depict the costs and the technological constraints facing the firm on the same diagram. The isoquants give us the technological constraints all the combinations of .iq .