6. Explain why, at an interior optimal solution to the firms cost-minimization problem, the additional output that

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6. Explain why, at an interior optimal solution to the firm’s cost-minimization problem, the additional output that the firm gets from a dollar spent on labor equals the additional output from a dollar spent on capital. Why would this condition not necessarily hold at a corner point optimal solution?

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Microeconomics

ISBN: 9780470563588

4th Edition

Authors: David Besanko, Ronald Braeutigam

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