Question: A packaging firm relies on the production function = (^1/2 + ^1/2) 2 , where Q is the amount of output, K is the amount

A packaging firm relies on the production function = (^1/2 + ^1/2) 2 , where Q is the amount of output, K is the amount of capital and L is the amount of labor

(a) Determine if the technology of the firm is constant return to scale or not

(b) What is the elasticity of the technical substitution?

(c) Suppose the price of capital is 2 and the price of labor is 2 as well. However, there are only 16 units of labor available to the firm in the short-run. What is the cost of producing 100 units?

(d) What is the minimum cost of producing 100 units if there is no limit supply of labor as in (c)

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