Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. Suppose you can produce water flasks according to the production process Q - K2 + 4K + L2 6L + KL, and that when

image text in transcribed
1. Suppose you can produce water flasks according to the production process Q - K2 + 4K + L2 6L + KL, and that when producing these flasks, you have a cost constraint expressed as 2/ - 2L = 32. 1.1. Calculate the marginal product of labour for this production process. [2] 1.2. Calculate the marginal product of capital for this production process. [2] 1.3. Using your answers for 1.2 and 1.3, calculate the optimum quantities of capital and labour when producing the water flasks because the marginal product per rand spent on each input needs to be equal when producing optimally. [4] 1.4. Using the Lagrange multipliers method, calculate how many water flasks you can produce whilst satisfying your cost constraint. [6]

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Public Policies For Environmental Protection

Authors: Paul R Portney

1st Edition

1317310144, 9781317310143

More Books

Students also viewed these Economics questions