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Suppose your goal is to produce 100 units of something as cost effectively as possible. There are 3 different methods which each have rising marginal
Suppose your goal is to produce 100 units of something as cost effectively as possible. There are 3 different methods which each have rising marginal costs, such that MC1= 24q1 , MC2= 4q2, MC3= 8q3. How much should you use each method? (Hint: The equimarginal principle suggests that if the marginal costs for the methods used are not equal then you can save resources by shifting to the one with lower marginal costs.)
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