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If wage rate of labour (w) is 6, the price of capital (r) is 3, and a firm faces the production function y = 4L
If wage rate of labour (w) is 6, the price of capital (r) is 3, and a firm faces the production function y = 4L 2/3 K 1/3 ,
- To minimize cost, derive the firm’s optimal choice of labor and capital (K) as a function of output level (y).
- What is the total cost function of this firm?
- What is the expansion path of this firm?
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Economics Today
Authors: Roger LeRoy Miller
16th edition
132554615, 978-0132554619
