The Acme Anvil Company's output is given by the Cobb-Douglas Production function P = 60L²/3K²/3, where P is the number of anvils produced when Lis the amount spent on labor and K is the amount spent on capital. a. What is the production if L = 150 and K = 150? b. Find the marginal productivities. c. Evaluate the marginal productivities with L 150 and K = 150. %3D d. Interpret the meanings of the marginal productivities found in part c. e. If their budget is $300 then there is a constraint L+ K = 300. Use Lagrange multipliers (A) to find the values of L and K that will maximize production and find the maximum production f. Find 2. 12 | is called the marginal productivity of money and will give the number additional units produced for each dollar increase in the budget. Interpret 2 for this problem.
The Acme Anvil Company's output is given by the Cobb-Douglas Production function P = 60L²/3K²/3, where P is the number of anvils produced when Lis the amount spent on labor and K is the amount spent on capital. a. What is the production if L = 150 and K = 150? b. Find the marginal productivities. c. Evaluate the marginal productivities with L 150 and K = 150. %3D d. Interpret the meanings of the marginal productivities found in part c. e. If their budget is $300 then there is a constraint L+ K = 300. Use Lagrange multipliers (A) to find the values of L and K that will maximize production and find the maximum production f. Find 2. 12 | is called the marginal productivity of money and will give the number additional units produced for each dollar increase in the budget. Interpret 2 for this problem.
Chapter1: Making Economics Decisions
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Transcribed Image Text:. The Acme Anvil Company's output is given by the Cobb-Douglas Production
=602/3 K/3, where P is the number of anvils produced when
function P
Lis the amount spent on labor and K is the amount spent on capital.
a. What is the production if L = 150 and K = 150?
b. Find the marginal productivities.
c. Evaluate the marginal productivities with L = 150 and K = 150.
d. Interpret the meanings of the marginal productivities found in part c.
e. If their budget is $300 then there is a constraint L+ K = 300. Use
Lagrange multipliers (2) to find the values of L and K that will
maximize production and find the maximum production
f. Find 2. 12| is called the marginal productivity of money and will give
the number additional units produced for each dollar increase in the
budget. Interpret 2 for this problem.
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