Urgent help please? Cobb-Douglas functionWatch
Each unit of capital cost $60 and each unit of labour cost $120 , it is also stated that $1,200,000 is budgeted for production of the product.
how can i find when production will be maximized solving for K and L?
Create your budget constraint given that you know the cost of capital, labour and the total amount budgeted.
Use this to create your lagrange equation.
Partially differentiate w.r.t K and L.
Equate these two equations and get a value for either K or L. You can then use this to find the value of the other.
Once you have values of K and L, you use this to find Q.