Aamir's company has the production function Q=8K^0.75L^0.25, where Q measures output, K measures machine hours, and L
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Aamir's company has the production function Q=8K^0.75L^0.25, where Q measures output, K measures machine hours, and L measures labor hours. Suppose that the rental rate of capital is R=$120, the wage rate is W=$20, and the firm wants to produce 800 units of output. Use the Lagrange method to find the optimal input mix. What the optimal level of K?
Related Book For
Microeconomics An Intuitive Approach with Calculus
ISBN: 978-0538453257
1st edition
Authors: Thomas Nechyba
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