Assume that the cost of producing goods x and y is characterized by the following function...

 

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Assume that the cost of producing goods x and y is characterized by the following function C(x, y) = 1000+ 0,08x² +0,02xy + 0,02y² + 8x + 4y The good x can be sold at the price of 30kr per unit, and y at the price of 9kr per unit. Profit is defined as income (sales) minus costs. Calculate the profit maximizing levels of the production of the two goods. Assume that second order conditions are satisfied and show your calculations. Assume that the cost of producing goods x and y is characterized by the following function C(x, y) = 1000+ 0,08x² +0,02xy + 0,02y² + 8x + 4y The good x can be sold at the price of 30kr per unit, and y at the price of 9kr per unit. Profit is defined as income (sales) minus costs. Calculate the profit maximizing levels of the production of the two goods. Assume that second order conditions are satisfied and show your calculations.

Answer rating: 100% (QA)

Profit is given by P 30x 008x 002xy 002y 8x 4y First we ... View the full answer