Answer to Question #239460 in Economics for SOK

Question

5. Consider Ajax company Ltd with an amount of $2400 to spend on two inputs, labour (L) and capital (K). the cost of labour and capital are $4 and $3 per unit respectively. If the firm production function takes the form Q = 2L^{0 .5}K^{0 .5}

a. Derive the demand function for labour and capital.

b. What quantities of labour and capital should the firm buy in order to maximize output?

Answer 1

Dear SOK, your question requires a lot of work, which neither of our experts is ready to perform for free. We advise you to convert it to a fully qualified order and we will try to help you. Please click the link below to proceed: Submit order