Answer to Question #160325 in Macroeconomics for Alex

Question

What is the correct formula for the isoquant associated with K=10 and L=10

Answer 1

Solution:

Cobb Douglas production function: Q = 10K^0.3L^0.6

The general formula of an isoquant in this production function is: $K=\frac{Q}{L}$

First derive Q: Where K = 10, and L = 10

Q = $(10) (10^{0.3} ) \times (10^{0.6} )$

 

= $19.95 \times 3.98 = 79.43$

Q = 79.43

Therefore, the correct isoquant formula:

$K=\frac{Q}{L}$

$K=\frac{79.43}{L^{0.6} }$