Fill This Form To Receive Instant Help
Fill This Form To Receive Instant Help
Homework answers / question archive / The ACME Lock Company's production function is given by Q = 10K0
The ACME Lock Company's production function is given by Q = 10K0.7L0.3, where K and L are ACME's annual capital and labor inputs, respectively, and Q is their annual output, measured in 1000s of locks.
The prices per unit of capital and labor are pK = $10000 and pL = $5000, respectively.
(a) (6 pts) Find ACME's minimum cost of producing 60,000 locks.
(b) (2 pts) Find ACME's maximum output if their production budget is B = $100,000.
Hint: You can use information from (a) to help solve (b) ? you don't have to do the optimization problem from scratch (unless you want to).
