Using the production function q = (z1ª + z2ª)1/a for a manufacturing firm, where z1 denotes labor, z2 denotes capital and a denotes a constant parameter, derive the (i) conditional factor demand functions and (ii) cost function. If a/(a-1) = +1 then show that the cost function will take a very simple form. Briefly explain how market regulators can make use of the cost function for this firm.

Using the production function q = (z1ª + z2ª)1/a for a manufacturing firm, where z1 denotes labor, z2 denotes capital and a denotes a constant parameter, derive the (i) conditional factor demand functions and (ii) cost function. If a/(a-1) = +1 then show that the cost function will take a very simple form. Briefly explain how market regulators can make use of the cost function for this firm.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter11: Profit Maximization

Section: Chapter Questions

Problem 11.3P

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Using the production function q = (z," + z2®)}/@ for a manufacturing firm, where z, denotes labor, zz denotes capital and a denotes a constant parameter, derive the ) conditional factor demand functions and (i) cost function. If a/la-1) - +1 then show that the cost function will take a very simple form. Briefly explain how market regulators can make use of the cost function for this firm.
I don't believe part (b) was fully answered. Can you please solve it with more detail?
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