Question

Bess the baker bakes “1-2-3-4 Cakes” at her bakery. The ingredients for each cake require exactly 1 cup of butter, 2 cups sugar, 3 cups flour, and 4 eggs. Describe what Bess’s isoquants look like graphically, for any two of her inputs. Draw Bess’s isoquants for butter and sugar for Q=2 cakes and Q=3 cakes

Answer 1

The factors are mixed in a fixed proportion for the given level of output. This information suggests complementarity between input and L shaped isoquant exhibit the same property. Hence, in this case, isoquants will be L shaped.

(1) We choose butter and sugar for isoquant;

Note: a:b= 1:2

Since butter and sugar are mixed in 1:2 then the expansion path will be Y= (1/2)X

(2) One cake requires one unit of butter and two units of sugar

Therefore, two cake requires two unit of butter and four units of sugar and three cake requires three unit of butter and six units of sugar.