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The Cobb-Douglas production function for a company is given by P(k, ) = 163k75/4/5 where Pis the monthly production value when k is the number of units of capital and I is the number of units of labor. Suppose that capital costs $105 per unit, labor costs $70 per unit, and the total cost of capital and labor is limited to $152,250. Use Lagrange Multipliers to write the system of equations you would use to find the number of units of capital and labor that maximize production. %3D

The Cobb-Douglas production function for a company is given by P(k, ) = 163k75/4/5 where Pis the monthly production value when k is the number of units of capital and I is the number of units of labor. Suppose that capital costs $105 per unit, labor costs $70 per unit, and the total cost of capital and labor is limited to $152,250. Use Lagrange Multipliers to write the system of equations you would use to find the number of units of capital and labor that maximize production. %3D

Microeconomics A Contemporary Intro
Microeconomics A Contemporary Intro
10th Edition
ISBN:9781285635101
Author:MCEACHERN
Publisher:MCEACHERN
Chapter7: Production And Cost In The Firm
Section: Chapter Questions
Problem 18PAE
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4) The Cobb-Douglas production function for a company is given by P(k, I) = 163k|/57475 where Pis the monthly production value when k is the number of units of capital and / is the number of units of labor. Suppose that capital costs $105 per unit, labor costs $70 per unit, and the total cost of capital and labor is limited to $152,250. Use Lagrange Multipliers to write the system of equations you would use to find the number of units of capital and labor that maximize production. %3D
Transcribed Image Text:4) The Cobb-Douglas production function for a company is given by P(k, I) = 163k|/57475 where Pis the monthly production value when k is the number of units of capital and / is the number of units of labor. Suppose that capital costs $105 per unit, labor costs $70 per unit, and the total cost of capital and labor is limited to $152,250. Use Lagrange Multipliers to write the system of equations you would use to find the number of units of capital and labor that maximize production. %3D
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