Answer to Question #229772 in Economics for Amuri

Question #229772

verify maximum output Q=( L ,K) subjected to c=wl +rk

Expert's answer

If the total output is Q = (L ,K) and total cost is c = wl + rk, then the output Q is maximized, when MPL/w = MPK/k, where MPL and MPK are marginal products of labour and capital respectively.

MPL = Q'(L), MPK = Q'(K).

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