Question

What is the​ long-run cost function for a​ fixed-proportions production function when it takes two units of labor and four units of capital to produce one unit of​ output? Describe the long-run cost curveLOADING.... Multiply the inputs by their prices and sum to determine total cost. Let w be the cost of a unit of labor and r be the cost of a unit of capital. The​ long-run cost function​ C(q) for the​ fixed-proportions production function in terms of​ w, r, and q is

Answer 1

Answer:

Sources of info are utilized in fixed extents of five units of L and 4 units of K. In this way, the creation capacity can be composed as:  

q = min {4L, 5K}  

Along these lines, q = 4L = 5K  

Along these lines, L = q/4 and K = q/5  

Cost,

C = wL + rK = [w(q/4)] + [r(q/5)]

C = 0.25wq + 0.2rq

C = (0.25w + 0.2r)q  

Along these lines, C(q) = (0.25w + 0.2r) q