Chapter6: Proudction Costs
Section: Chapter Questions
Problem 3SQP
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Question
Brian uses wool (K) and labour (L) to produce t-shirts (q).
The production function is: q = min{1/3L, 2K}.
If he uses 0.5 kg of wool and 3 hours of labour, he can produce 1 t-shirt.
1. The pice of wage per hour is given by w=$10 and the price of each kg of wool is given by r=$4. What is the L(q) and K(q)?
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