Question: The production function for sweaters is: Q = 80L - 2L 2 Sweaters sells for $10 per unit.The cost of each unit of labor (L)

The production function for sweaters is:

Q = 80L - 2L2

Sweaters sells for $10 per unit.The cost of each unit of labor (L) is $40 per hour.

a) What is the optimal amount of labor to hire?

b) Assume sweaters are out of sale for $5

What is the optimal amount of labor to hire now?

c) Assume that during the $5 sale, the demand for labor greatly increases and the cost per unit of labor is increased to $60 per unit of labor.

What is the optimal amount of labor to hire now?

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