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19 Jul 2018
5. (11 marks) Suppose that the production function of some firm is the Cobb-Douglas production function, f(x, y) = 5x1/5,4/5 where is the number of units of labor and y is the number of units of capital. The firm has a total budget of 60,000 dollars and a unit of labor costs 60 dollars and a unit of capital costs 20 dollars. What contribution of labors and capitals will maximize the production. (Do not need to show that your answer is a maximum.) Answer
5. (11 marks) Suppose that the production function of some firm is the Cobb-Douglas production function, f(x, y) = 5x1/5,4/5 where is the number of units of labor and y is the number of units of capital. The firm has a total budget of 60,000 dollars and a unit of labor costs 60 dollars and a unit of capital costs 20 dollars. What contribution of labors and capitals will maximize the production. (Do not need to show that your answer is a maximum.) Answer
Elin HesselLv2
20 Jul 2018
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