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A firm produces output according to the production function: Q=F(K.L) = 4K - 8L a. How much output is produced when K= 2 and L = 3? b. If the wage rate is $60 per hour and the rental rate on capital is $20 per hour, what is the cost-minimizing input mix for pre units of output? Capital: Labor: c. If the wage rate decreases to $20 per hour but the rental rate on capital remains at $20 per hour, what is the cost-minimizi mix for producing 32 units of output?

A firm produces output according to the production function: Q=F(K.L) = 4K - 8L a. How much output is produced when K= 2 and L = 3? b. If the wage rate is $60 per hour and the rental rate on capital is $20 per hour, what is the cost-minimizing input mix for pre units of output? Capital: Labor: c. If the wage rate decreases to $20 per hour but the rental rate on capital remains at $20 per hour, what is the cost-minimizi mix for producing 32 units of output?

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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A firm produces output according to the production function: Q=F(K.L) = 4K - 8L a. How much output is produced when K= 2 and L= 3? b. If the wage rate is $60 per hour and the rental rate on capital is $20 per hour, what is the cost-minimizing input mix for producing 32 units of output? Capital: Labor: c. If the wage rate decreases to $20 per hour but the rental rate on capital remains at $20 per hour, what is the cost-minimizing input mix for producing 32 units of output? Capital Labor:
Transcribed Image Text:A firm produces output according to the production function: Q=F(K.L) = 4K - 8L a. How much output is produced when K= 2 and L= 3? b. If the wage rate is $60 per hour and the rental rate on capital is $20 per hour, what is the cost-minimizing input mix for producing 32 units of output? Capital: Labor: c. If the wage rate decreases to $20 per hour but the rental rate on capital remains at $20 per hour, what is the cost-minimizing input mix for producing 32 units of output? Capital Labor:
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