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3 points ) What is the short run cost function? Show the quantity the firm would want to produce the same as in part (
points What is the short run cost function? Show the quantity the firm would want to produce the same as in part a
c points Suppose a manager finds a new management technique that would produce output using the following production function:
q~KLKL
Is the firm better off or worse off switching to the new management technique? textithint: Compare short run profits.
d points In the long run both capital and labour can be adjusted. Assuming the firm is producing q using the new technique ie q~ what is the optimal amount of capital and labour hired? Does the firm make a profit here? How does profit compare with part c
e points Find the long run cost curve for q~
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