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A profit maximizing firm has a production function such that:
Y=K2L2
a) If P=10,rk=2,andWL=3 , what would be its optimum be? How can you show that it is a maximum?
b) How would the answer change if it needs to produce at least 100 units of Y and that it now is a cost minimizing firm?
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Instructions For the following 10 questions, consider an economy which is initially in equilibrium without a tax, with P* of $90 and Q* of 10. Later, a tax is put on the market
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