Your automobile assembly plant has a Cobb-Douglas production function given by x0.4 0.6 q= where q is the number of automobiles it produces per year, x is the number of employees, and y is the daily operating budget (in dollars). Annual operating costs amount to an average of $29,000 per employee plus the operating budget of $365y. Assume that you wish to produce 4,000 automobiles per year at a minimum cost. How many employees should you hire? (Round your answer to the nearest employee.) x employees X =

Your automobile assembly plant has a Cobb-Douglas production function given by x0.4 0.6 q= where q is the number of automobiles it produces per year, x is the number of employees, and y is the daily operating budget (in dollars). Annual operating costs amount to an average of $29,000 per employee plus the operating budget of $365y. Assume that you wish to produce 4,000 automobiles per year at a minimum cost. How many employees should you hire? (Round your answer to the nearest employee.) x employees X =

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Your automobile assembly plant has a Cobb-Douglas production function given by
=x0.4 0.6,
q = x
where q is the number of automobiles it produces per year, x is the number of employees, and y is the daily operating
budget (in dollars). Annual operating costs amount to an average of $29,000 per employee plus the operating budget of
$365y. Assume that you wish to produce 4,000 automobiles per year at a minimum cost. How many employees should you
hire? (Round your answer to the nearest employee.)
X employees
X =

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