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Mathematics, 30.06.2021 21:10 224509
A manager hires labour and rents capital equipment in a very competitive market. Currently the wage rate is GH¢2 per hour and capital is rented at GH¢5 per hour, the unit price of the product is GH¢0.25 and total cost is 1000. Suppose the firm’s production function is as follows:
Q= 140.5 0.5+10
i. What is the amount of labour and capital the firm should employ in order to maximize output? [Hint: Maximise the product function subject to the cost constraint]
ii. What is the maximum profit?
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A manager hires labour and rents capital equipment in a very competitive market. Currently the wage...
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