Question

A firm has the following short-run production function as follows: Q = 15L +18L2 - 0.5L, where Q = total products per period

4.3) (6 points) Determine the boundaries (ranges of number of workers) for the three stages of production process. Stage 1: S

4.4) (8 points) Suppose that the price of a product is S1 per unit. How many workers will the firm hire to maximize profit if

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Answer #1

Q4.3) stage I 0<L<18

Stage II 18<L< 24.41

Stage III L > 24.41

Q4.4) L hired = 23.136

L- +36+ |(36)2 4(1.5)(30) 2(105) > L= 36€ N116 /3 L = 88.136 Ang 3

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