Answer to Question #73811 in Microeconomics for Hajra Shabir6

Question

Find the equilibrium of L and K subject to a given output:

minimize cost: C=40K+20L subject to Q=60LK = 3000

Answer 1

Minimize cost: C = 40K + 20L subject to Q = 60LK = 3000 or LK = 50.
The equilibrium of L and K subject to a given output is K = 5 units and L = 10 units, at this point total cost is minimized.
We can find this solution using "find solution" in excel.