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2 The Cost of Glasses The production function for glasses is: g = 21.8 p.2 Where g is the amount of glasses produced, L is
2 The Cost of Glasses The production function for glasses is: g = 21.8 p.2 Where g is the amount of glasses produced, L is the amount of labor used, and P is the amount of plastic used. The price of labor is we and the price of plastic is wp. a. Define the firm's cost minimization problem if it wants to produce g glasses. b. What is the conditional factor demand for labor? c. What is the conditional factor demand for plastic? d. What is the cost function? e. Take the derivative of the cost function with respect to wz. What can you say about this derivative
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