Consider a firm with the production function ƒ(x1, x2) = x₁/²x2. The price of the two inputs is w₁ = 2 and w₂ = 1. When the firm is minimizing costs, how many dollars will it spend on input 2 for every dollar spent on input 1? How many units of input 2 will the firm use for every unit of input 1? Suppose the firm produces a total quantity of q=108 at minimal cost. What is x1? Suppose the firm produces a total quantity of q=108 at minimal cost. What is x2?

Consider a firm with the production function ƒ(x1, x2) = x₁/²x2. The price of the two inputs is w₁ = 2 and w₂ = 1. When the firm is minimizing costs, how many dollars will it spend on input 2 for every dollar spent on input 1? How many units of input 2 will the firm use for every unit of input 1? Suppose the firm produces a total quantity of q=108 at minimal cost. What is x1? Suppose the firm produces a total quantity of q=108 at minimal cost. What is x2?

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter10: Cost Functions

Section: Chapter Questions

Problem 10.6P

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