Q7. The production function is y=L¹/aK¹/B.The price of the output is $100, w = $15, and r= $12.a. Find the optimal input of labor and capital.b. Find the optimal output which maximizes the profit.

Introduction We have given a production function. Optimal level of input can be achieved at where…

Q7. The production function is y=L¹/aK¹/B. $12. The price of the output is $100, w = $15, and r=; a. Find the optimal input of labor and capital. b. Find the optimal output which maximizes the profit.

Q7. The production function is y=L¹/aK¹/B. $12. The price of the output is $100, w = $15, and r=; a. Find the optimal input of labor and capital. b. Find the optimal output which maximizes the profit.

Microeconomics A Contemporary Intro

10th Edition

ISBN:9781285635101

Author:MCEACHERN

Publisher:MCEACHERN

Chapter7: Production And Cost In The Firm

Section: Chapter Questions

Problem 17PAE

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Q7. The production function is y=L¹/aK¹/B.
The price of the output is $100, w = $15, and r= $12.
a. Find the optimal input of labor and capital.
b. Find the optimal output which maximizes the profit.

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