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Hello Sir,
I'm not getting the answer to ME II question 1......I would be very grateful if you could please help me into the matter :
A price taking firm makes machine tools Y using labour and capital according to the following production
function
Y = K^0:25.L^0:25
Labour can be hired at the beginning of every week, while capital can be hired only at the beginning of every
month. It is given that the wage rate = rental rate of capital = 10. Show that the short run (week) cost
function is 10Y^4/K *where the amount of capital is fi xed at K * and the long run (month) cost function is
20Y^2
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