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2. Firm Fiat Lux, a light bulb company, has the production function q = 2L 0.5K...

2. Firm Fiat Lux, a light bulb company, has the production function q = 2L 0.5K 0.5. If it has to make 800 light bulbs, and the price of one unit of capital is 40 and the price of one unit of labor is 25, use the Lagrangian method to find the marginal cost of production.

3. Jack’s preferences are represented by the utility function U = X0.4Y0.6. PX = 2, PY = 3 and his budget is $120. Setting the Lagrangian to solve Jack’s utility maximization problem, what is the value of λ?

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