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11 2. Suppose a producer's production function is F(K, L) = 3KzLz The cost of K is 20 (r = 20) and the cost of
11 2. Suppose a producer's production function is F(K, L) = 3KzLz The cost of K is 20 (r = 20) and the cost of L 1s 80 (w = 80) The firm wants to produce 30 units of output. a. What is the cost-minimizing way for the firm to produce 30 units of output? How many units of capital and how many units of labor should be used? b. Suppose the firm has committed itself to 4 units of capital (K) and therefore is operating in the short run. What combination of inputs is the least costly way for it to produce 30 units now
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