Construction Technologies (CONTEC) has been in operation for over 25 years in the construction industry, St....

 

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Construction Technologies (CONTEC) has been in operation for over 25 years in the construction industry, St. Kitts. CONTEC has been experiencing increased competition from startup competitors and realizes that it would need to minimize cost to stay in business. CONTEC wants to produce a total of 100 cubic meters of concrete (i.e., q = 100), and seeks to find out what is the optimal mix of labour and capital it would require to do so. Given: Production function - q = L.75 K.25 Wage=$150 per week Rent $50 per week Find the optimal input mix of labour and capital by deriving the following: a. Find MP, & MPK [10 marks] b. Determine the profit maximizing usage of Labour & capital. [15 marks] Construction Technologies (CONTEC) has been in operation for over 25 years in the construction industry, St. Kitts. CONTEC has been experiencing increased competition from startup competitors and realizes that it would need to minimize cost to stay in business. CONTEC wants to produce a total of 100 cubic meters of concrete (i.e., q = 100), and seeks to find out what is the optimal mix of labour and capital it would require to do so. Given: Production function - q = L.75 K.25 Wage=$150 per week Rent $50 per week Find the optimal input mix of labour and capital by deriving the following: a. Find MP, & MPK [10 marks] b. Determine the profit maximizing usage of Labour & capital. [15 marks]

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To find the optimal input mix of labor and capital for CONTEC we need to maximize profit Lets go ste... View the full answer