Microeconomics Theory - Production and Cost Function

Level pending

A firm has the following production function Q and cost function as follows:

Q= KL where Q = quantity, K=capital, L=labor

C= 3L +12K where C= cost

Calculate the cost when the firm produced 36 units.

Hint: In equilibrium, $$\boxed{MPK/r=MPL/w}$$ where MPK and MPL are marginal products of capital and labor respectively; and w and r are cost of capital and labor.

×