Answer to Question #73811 in Microeconomics for Hajra Shabir6
Find the equilibrium of L and K subject to a given output:
minimize cost: C=40K+20L subject to Q=60LK = 3000
Minimize cost: C = 40K + 20L subject to Q = 60LK = 3000 or LK = 50. The equilibrium of L and K subject to a given output is K = 5 units and L = 10 units, at this point total cost is minimized. We can find this solution using "find solution" in excel.