q = AB + B2 1. Find the expressions for the cost minimizing levels of A and B. You do not have to write the long-run cost function. A is the labor input and B is the capital input. 2. What is different about this production function, relative to the Cobb-Douglas-type production functions we have been working with previously? Why is this characteristic particularly important for the decision maker in this scenario, where they are choosing a single location?
q = AB + B2 1. Find the expressions for the cost minimizing levels of A and B. You do not have to write the long-run cost function. A is the labor input and B is the capital input. 2. What is different about this production function, relative to the Cobb-Douglas-type production functions we have been working with previously? Why is this characteristic particularly important for the decision maker in this scenario, where they are choosing a single location?
Chapter6: Proudction Costs
Section: Chapter Questions
Problem 3SQP
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