Question: Q = 6L - 0.1L 2 + 4 K - 0.2 K 2 The wage rate is $30, the cost of capital is $40, and

  1. Q = 6L - 0.1L2 + 4 K - 0.2 K2

The wage rate is $30, the cost of capital is $40, and output sells for $50.

  1. In the short run, capital is fixed at 5 units. How much labor do you recommend?

In the long run, the firm decides to increase its inputs by 10% as compared to its inputs in part a. What do you conclude about returns to scale

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