[VC] A firm is using a Cobb-Douglas production function q = (K(ª)) × (L1-4)) in the creation of bottled soda. Let q = the number of cases of bottled sodas, K = the number of machines, L = the number of workers hired, and a = . [VC] Suppose the market wage is w = $6 based on LS = 500 which means the firm would produce q = 200 cases in the short-run. If the firm continues to produce q = 200 and is able to adjust K and L (with P = $22.50, w = $6, and r = $24), how many people would be hired and how much capital would be used (note: assume the labour supply LS will have time to adjust and is not fixed).
[VC] A firm is using a Cobb-Douglas production function q = (K(ª)) × (L1-4)) in the creation of bottled soda. Let q = the number of cases of bottled sodas, K = the number of machines, L = the number of workers hired, and a = . [VC] Suppose the market wage is w = $6 based on LS = 500 which means the firm would produce q = 200 cases in the short-run. If the firm continues to produce q = 200 and is able to adjust K and L (with P = $22.50, w = $6, and r = $24), how many people would be hired and how much capital would be used (note: assume the labour supply LS will have time to adjust and is not fixed).
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Answer the attached question
![[VC] A firm is using a Cobb-Douglas production function q = (K(ª)) × (L1-4)) in
the creation of bottled soda. Let q
= the number of cases of bottled sodas, K = the number of
machines, L = the number of workers hired, and a = .
[VC] Suppose the market wage is w = $6 based on LS
= 500 which means
the firm would produce q = 200 cases in the short-run. If the firm continues to produce
q = 200 and is able to adjust K and L (with P = $22.50, w = $6, and r = $24), how many
people would be hired and how much capital would be used (note: assume the labour
supply LS will have time to adjust and is not fixed).](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F74bd447b-fef4-433c-a93d-4651faee92d4%2F48817381-5833-40da-9d1a-0e8cb4760024%2Fqoecz5v_processed.png&w=3840&q=75)
Transcribed Image Text:[VC] A firm is using a Cobb-Douglas production function q = (K(ª)) × (L1-4)) in
the creation of bottled soda. Let q
= the number of cases of bottled sodas, K = the number of
machines, L = the number of workers hired, and a = .
[VC] Suppose the market wage is w = $6 based on LS
= 500 which means
the firm would produce q = 200 cases in the short-run. If the firm continues to produce
q = 200 and is able to adjust K and L (with P = $22.50, w = $6, and r = $24), how many
people would be hired and how much capital would be used (note: assume the labour
supply LS will have time to adjust and is not fixed).
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