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ltaullastion 1: Supply [9 llarlts; 2, 2, 2, 3] lCarrnaker produces small cars in a perfectly.r competitive market using labour {L} and capital {K}. ISarrnaker's
ltaullastion 1: Supply [9 llarlts; 2, 2, 2, 3] lCarrnaker produces small cars in a perfectly\".r competitive market using labour {L} and capital {K}. ISarrnaker's production function is given by f{L.K} = min {$.05L. Km}, where Q is the number of cars produced. {a} [2 marks] Starting from L 3. t], K 3 II}. suppose you double the amount of L and K. Is it possible for output {q} to more than double [i.e.1 increase from o to Aq where A a 2]? {b} [2 marks] Find the minimum cost to produce :1 cars when the price of lab-our [w] is 4GB and price of capital [r] is 1G? [Hint: the answer would involve q.]
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