A firm has a production function homogeneous of degree one, , with price Rs. and price Rs. . Assuming zero fixed cost, the total cost (long run) of producing units of is Rs. ________ (in integer).
1 markMicroeconomicsCosts of productionCost minimisation and long-run input choiceModerateabout 2 min
IIT JAM 2024 Question 41: Costs of production
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Plain-text version
A firm has a production function homogeneous of degree one, Q = 2√LK, with L price Rs. 4 and K price Rs. 16. Assuming zero fixed cost, the total cost (long run) of producing 10 units of Q is Rs. (in integer).
Also written as: A firm has a production function homogeneous of degree one, Q = 2sqrt(LK), with L price Rs. 4 and K price Rs. 16. Assuming zero fixed cost, the total cost (long run) of producing 10 units of Q is Rs. (in integer).
Costs of production has come up 83 times in 7 exams since 2006.
What this question tests
This question is on Cost minimisation and long-run input choice, part of Costs of production in Microeconomics.
Choosing inputs to produce a given output at least cost, including across several plants.
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