isi 2006 me 2 AGAIN

[SHIKHA]

QUES 2

http://economicsentrance.weebly.com/uploads/1/1/0/5/1105777/msqe2006.pdf

A price-taking farmer produces a crop with labour L as the only input.
His production function is: ) F   =   (10 (L^1/2 )− 2L) .  He has 4 units of labour
in his family and he cannot hire labour from the wage labour market. He
does not face any cost of employing family labour.
(a) Find out his equilibrium level of output.
(b) Suppose that the government imposes an income tax at the rate of
10 per cent. How does this affect his equilibrium output?
(c) Suppose an alternative production technology given by:
F(L) = 11 (L^1/2) − L −15  is available. Will the farmer adopt this
alternative  technology? Briefly justify your answer.

WHAT ANS U GUYS GETTING?????

[ritu]

maximum labor he can employ=4
when u maximise production function.....mc=0 so u put mp=0 which gives optimal L*>4
SO HE WILL produce maximum possible output ....which is 12 in this case..(.just put l=4 in production function.)..
lets see wot our frnz say...i might be wrong..


he wont use the new technology by using above logic
(plz confirm)