What is the profit maximizing quantity

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A firm's production function is qi = 2Li + 10Ki. Assume both variables can be adjusted, even in the short run (for instance, making an item by hand versus using a machine to do so).

a. What is the firm's cost function, if w=$15, and r = $100?

b. What is the firm's cost function, if w = $25 and r = $100?

c. How could we write the results of a and b above in a more general way, with w and r expressed as variables?   (Hint, use "min")

d. Now suppose the output price is $8. If the input prices from part a are in effect, what is the profit maximizing quantity? If instead, the input prices from part b are in effect, what is the profit maximizing quantity?

Reference no: EM131378491

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