Question

**A firm’s production function is Q = min(K , 2L), where Q
is the number of units of output produced using K units of capital
and L units of labor. The factor prices are w = 4 (for labor) and r
= 1 (for capital). On an optimal choice diagram with L on the
horizontal axis and K on the vertical axis, draw the isoquant for Q
= 12, indicate the optimal choices of K and L on that isoquant, and
calculate the total cost.**

Answer #1

3. A firm’s production function is Q=min(K, 3L ). Input prices a
re as follows: w=$ 2 and r=$1.
On the optimal choice diagram below, draw the isoquant for Q=12.
Calculate the optimal choice of K and L for this level of output as
well as the total cost.
Then, draw in (with a dotted line) the isocost line consistent
with your Total Cost value.
It won't let me copy the graph template but it is a simple graph
with...

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. 1
a) Calculate the corresponding cost
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·q=(min(L,3K)).5
·q=L-1/K
b) Draw a representative isoquant for
q=12
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B) Suppose K = 4. How many units of labor should the firm use if
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The firms production function is: Q=2L^2/3 K^1/3
A) Suppose the firm wants to determine the cost minimizing
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B) Using these factor demand functions, solve for the firm's
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A firm’s production function is Q! = min(4L ,5K ). The price of
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a) Derive the demand function of labor and capital respectively.
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