A firm produces output according to the production
Question # 00139857
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Updated on: 11/24/2015 11:26 AM Due on: 12/24/2015
A firm produces output according to the production function:
Q= F(K,L) = 4K+ 8L.
a. How much output is produced whenK=2andL=3?
b. If the wage rate is $60 per hour and the rental rate on capital is $20 per hour, what is the cost-minimizing input mix for producing 32 units of output?
Capital:
Labor:
c. If the wage rate decreases to $20 per hour but the rental rate on capital remains at $20 per hour, what is the cost-minimizing input mix for producing 32 units of output?
Capital:
Labor:
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Rating:
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Solution: A firm produces output according to the production