Question
The production function is F(L, K) = L^(1/2) K^(1/2) . In the short-run, the firm sells its output at a price of $10 per unit,
The production function is F(L, K) = L^(1/2) K^(1/2) . In the short-run, the firm sells its output at a price of $10 per unit, and can hire labor at a wage of $5 per unit. Capital is fixed at 25 units. The amount of labor that minimizes costs is:
a. L=1
b. L=2
c. L=10
d. None is correct
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Microbiology A Systems Approach
Authors: Marjorie Kelly Cowan
5th Edition
1259947963, 9781259947964
