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Example 2 Vls. Adadzewa has to set up a firm that produces soft drinks competing with the likes of 'epsi and Coca Cola. In order

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Example 2 Vls. Adadzewa has to set up a firm that produces soft drinks competing with the likes of 'epsi and Coca Cola. In order for to estimate the amount of labour and capital needed to naximlse profit in the long run, Ms. Adadzewa has employed you to help him in this 'egard. Currently, the competitive wage rate is set at CZ per unit of labour and capital is 'ented at C18 per unit. The forces of demand and supply in the industry has also set the equilibrium price of the soft drink at c125 per unit. Suppose the production function of :he firm is given as Q = 10K \"'5L*5 + 20 and the rm is contracted to produce a total 3f 770 soft drinks. ' Find the Optimal levels of capital and labour needed to minimise cost. ' The maximum profit of the firm at the optimal levels of labour and capital

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