Suppose that a firm has a production function f(L, K) = 3LK + K and the...

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Suppose that a firm has a production function f(L, K) = 3LK + K and the input prices are w = 6 and r = 10 (a) If the firm is targeting q = 125, then find the long-run cost minimizing labor and capital combination. Write the total cost function. (b) If the firm is targeting q = 20, then find the long-run cost minimizing labor and capital combination. Write the total cost function. (c) Suppose the wage rate increases and is now w' = 10 and the rent is r = 10, find the long-run cost minimizing inputs bundle for q = 125. Compare them to your findings in part (a). Suppose that a firm has a production function f(L, K) = 3LK + K and the input prices are w = 6 and r = 10 (a) If the firm is targeting q = 125, then find the long-run cost minimizing labor and capital combination. Write the total cost function. (b) If the firm is targeting q = 20, then find the long-run cost minimizing labor and capital combination. Write the total cost function. (c) Suppose the wage rate increases and is now w' = 10 and the rent is r = 10, find the long-run cost minimizing inputs bundle for q = 125. Compare them to your findings in part (a).

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To find the longrun costminimizing combination of labor and capital we need to use the production function fL K 3LK K along with the input prices w fo... View the full answer