Jeff makes coffee tables in his workshop, and while he is great at woodworking, he needs...

 

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Jeff makes coffee tables in his workshop, and while he is great at woodworking, he needs some help figuring out his finances and how much time he should devote to this side hustle. After a lot of trial and error, Jeff's best estimate is that his production function is f(K, L) = 4√K + 2√L. Jeff pays r = 80 for each unit of capital, and has an opportunity cost of w = 20 for each hour of labor he supplies. Solve for Jeff's long-run total cost function. What is his long-run marginal cost function? Jeff makes coffee tables in his workshop, and while he is great at woodworking, he needs some help figuring out his finances and how much time he should devote to this side hustle. After a lot of trial and error, Jeff's best estimate is that his production function is f(K, L) = 4√K + 2√L. Jeff pays r = 80 for each unit of capital, and has an opportunity cost of w = 20 for each hour of labor he supplies. Solve for Jeff's long-run total cost function. What is his long-run marginal cost function?

Answer rating: 100% (QA)

To determine Jeffs long run total cost function we need to consider the costs of both capital k and ... View the full answer