Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

plz solve it for me it is the subject of micro economics Question 2 (14 points) Charlie owns a brownie factory and his production function

plz solve it for me it is the subject of micro economics

image text in transcribed
Question 2 (14 points) Charlie owns a brownie factory and his production function is f (k, 1) = k0.510.25 Where k denotes unites of capital and I is the units of labor. a. Bob wants to produce 2000 brownies a day. Suppose the price of capital (rent) is $10 and the price of labor (wage) is $20. What is the cost-minimizing total cost in the long run? When you are solving this question be sure to write the minimization problem, the associated lagrangian and the first order conditions. (8 points) "b. In the short run Bob uses 25 units of capital. The rent and the wage are $10 and $20 respectively. Please write (6 points) down the total fixed cost, total variable cost, total cost, average fixed cost, average variable cost and marginal cost

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Macroeconomics

Authors: Paul Krugman, Robin Wells

4th Edition

1464110379, 9781464110375

More Books

Students also viewed these Economics questions

Question

3. It is the commitment you show that is the deciding factor.

Answered: 1 week ago