Question #280778

Suppose Q gives the production function Q=150KL and the price of labor and capital is 2.5 and 6 birr respectively. If the total outlays of the firm is 3000 Birr. Determine the level of employment of both inputs that maximizes output.

1
Expert's answer
2021-12-20T11:23:35-0500

SolutionSolution


Q=150KLLabor=2.5Capital=6Outlay=3000Maximizes output.Q=150×6×2.5Q=2250.Q=150KL\\ Labor=2.5\\ Capital =6\\ Outlay=3000\\ Maximizes \ output. \\ Q=150\times6\times2.5\\ Q=2250.


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