Assume a firm has the following production function with inputs labor (L) and capital (K): q=

Economics Dec 12, 2020

Assume a firm has the following production function with inputs labor (L) and capital (K): q=.LK Assume that, in the short-run, the firm's capital is fixed at two units, K = 2. In addition, assume that the firm must pay a wage of $2(w=2) for each unit of labor that they hire in the short-run. If the firm's profit-maximizing level of output in the short-run is q = 3, what must be the price (p) that they can charge for each unit of output they produce? P = dollars

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