This preview shows page 1. Sign up to view the full content.
Unformatted text preview: L ) when 4 units of labor are utilized. i. ( Hint : remember that MP L is dQ/dL, or the derivative of the prod function with respect to L.) b) Suppose the firm can hire labor at a wage of $5 per hour and output can be sold at a price of $25 per unit. Determine the profit-maximizing levels of labor and output. i. ( Hint : Remember that the firm maximizes its profit when VMP = P * MP L = w ) C:\ My Documents\1-Man Ec 387\1 - Winter 2010\class 9 cost functions\4de001d66eecafd7f0ccc891719cb07c3b499444.doc 1...
View Full Document
- Fall '08