For this part, solve for the utility maximization and cost minimization problems. Additionally, indicateeach important step in solving for the utility maximization of the consumer and the cost minimizationof the producer.a. Suppose that a producer wants to minimise the cost of producing t-shirts given as:TC = (WL)+ (RK)Q(K, L) = 10K0.2 L0.65s.t.Suppose that the firm must produce Q = 945 shirts, and that the price of the using printing machine(capital) is Php 1700/hour and that the wage of each worker is Php 500/hour. Solve for the conditionalinput demand and the total cost of production per day (assuming that there are 8 hours in one workingday).

We have, TC = WL + RK Production function :- Q(K, L) is 10K0.2L0.65 W is 500 R is 1700 Q is 945

important step in solving for the utility maximization of the consumer and the cost minimization e producer. Suppose that a producer wants to minimise the cost of producing t-shirts given as: TC = (WL)+ (RK) Q(K, L) = 10K0.2L0.65 s.t. ose that the firm must produce Q = 945 shirts, and that the price of the using printing machine tal) is Php 1700/hour and that the wage of each worker is Php 500/hour. Solve for the conditiona demand and the total cost of production per day (assuming that there are 8 hours in one working

important step in solving for the utility maximization of the consumer and the cost minimization e producer. Suppose that a producer wants to minimise the cost of producing t-shirts given as: TC = (WL)+ (RK) Q(K, L) = 10K0.2L0.65 s.t. ose that the firm must produce Q = 945 shirts, and that the price of the using printing machine tal) is Php 1700/hour and that the wage of each worker is Php 500/hour. Solve for the conditiona demand and the total cost of production per day (assuming that there are 8 hours in one working

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Concept explainers

Form Utility

The term utility in general refers to the satisfaction earned from usage of a particular product or service. Utility always plays an important role because it influences various important elements like demand & thereby the price of the good or service as well. Though utility is not easy to measure, various types of economic models can be used indirectly. There can be various types of utilities like economic utility, marginal utility, cardinal utility, form utility.

Question

For this part, solve for the utility maximization and cost minimization problems. Additionally, indicate
each important step in solving for the utility maximization of the consumer and the cost minimization
of the producer.
a. Suppose that a producer wants to minimise the cost of producing t-shirts given as:
TC = (WL)+ (RK)
Q(K, L) = 10K0.2 L0.65
s.t.
Suppose that the firm must produce Q = 945 shirts, and that the price of the using printing machine
(capital) is Php 1700/hour and that the wage of each worker is Php 500/hour. Solve for the conditional
input demand and the total cost of production per day (assuming that there are 8 hours in one working
day).

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