A rm has production function q = K^1/3 L^2/3. Input prices are w = 1 for...

A rm has production function q = K^1/3 L^2/3. Input prices are w = 1 for labor (L), and r=1 for capital (K).

a. Write down the firm's Cost Minimization Problem. Derive the optimality conditions.

b. Define the optimal choice of inputs, i.e. solve the Cost Minimization problem above for K and L.

c. What is the total cost to produce q=4 units of output?

Expert Solution

Rahul Sunny answered 2 years ago

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