There is a cupcake company. It produces cupcakes using workers and machines. Each week it produces...
- There is a cupcake company. It produces cupcakes using workers
and machines. Each week it produces 500 cupcakes. The production
function is Q=2K^0.5L^0.5 where Q is the number of cupcakes, K is
the number of machines, L is the number of workers. The wage for
workers is $20 and the cost of machines is $10.
- What is the cost function
- What is the optimal ratio of workers to machines
- What is the minimum cost of producing 500 cupcakes.
- How many cupcakes can the company produce if it has a budget of $1000 per week.
Homework Answers
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There is a cupcake company. It produces cupcakes using workers
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You manage a plant that mass produces engines by teame of workers using assembly machines. The chrologie summarized by the production function - 10KL Where is the number of engines per week. Kis the number of assembly machines, and is the number of labor teams. Each assembly machinerents for re$10,000 per week, and each team costs w $8,000 per week Engine costs are given by the cost of labor teams and machines, plus $1,000 per engine for raw materials. Your...
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