Problem

Business: Isocosts and Isoquants The intersection of an isocost line wL + rK = C and an...

Business: Isocosts and Isoquants The intersection of an isocost line wL + rK = C and an isoquant curve K = aLb (see pages 18 and 31) gives the amounts of labor L and capital K for fixed production and cost. Find the intersection point (L, K) of each isocost and isoquant. [Hint: After substituting the second expression into the first, multiply through by L and factor.]

3L + 8K = 48 and K = 24 · L-1

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