Question: 3. Consider the production function @ = 10L %LZ + 24K K?, where L is labor and K is capital. Suppose the input prices are

3. Consider the production function @ = 10L %LZ + 24K K?, where L is labor and K is capital. Suppose the input prices are $40 for labor and $80 for capital and the price of output is $10. a. Suppose in the example above, you find that the firm is producing using five units of labor and five units of capital. What advice would you give them regarding changing their input mix? More labor intensive or more capital intensive? How do you know? b. Solve for the optimal input mix for this firm

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