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Cost-minimizing firm production function

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A cost-minimizing firm's production function is Q = LK. The price of labor services is w and the price of capital services is r. Suppose that w = $10, r = $5, and the firm's total cost is $140.

(a) What are the firm's MPL, MPK?

(b) What is the firm's optimal input combination of L and K? What is Q?

(c) Suppose the wage rate is 0.5 times the rental rate and Q is the same. What is the firm's optimal input combination of L and K after the price change?

Reference no: EM131423853

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