Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The quantity, q, of a product manufactured depends on the number of workers, W, and the amount of capital invested, K, and is given by
The quantity, q, of a product manufactured depends on the number of workers, W, and the amount of capital invested, K, and is given by the Cobb-Douglas function q=6WKi. In addition, labor costs are $16 per worker and capital costs are $32 per unit and the budget is $4800. (a) What are the optimum number of workers and the optimum number of units of capital? Enter the exact answers. (b) Recompute the optimum values of Wand Kwhen the budget is increased by $1. Give the value of ,1. Round your answers for Wand K to three decimal places and your answer for ,1 to two decimal places
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