Use the production function: q = 4l1/2k1/2. refer to scenario 3. suppose that the price of labor is $5 and the price of capital is $20. your firm desires to produce 200 units of output. how much labor will be hired to minimize the costs of producing 200 units of output?

100 labor will be hired to minimize the costs of producing 200 units of output.

Explanation:

Maximising profit

Profit (Pr) = P*Q - Cost

                = P*Q - 5L - 20K

                 = P*4(LK)^0.5 - 4L - 20K

       dPr/dL= P*2(K/L)^0.5 - 4 = 0

       dPr/dK = P*2(L/K)^0.5 - 20 =0

We know equilibrium condition

MPL/MPK = w/ r

                 = 5/20

                  = 0.25  

MPL = 2(K/L)^0.5  MPK = 2(L/K)^0.5

K/L = 0.25

K = 0.25L

200 = 4(0.25L^2)^0.5

       =4*0.5*L

L = 100

Therefore, 100 labor will be hired to minimize the costs of producing 200 units of output.

the correct answer is economics is a game without winners or losers.

unlike sports or games economic is a game without losers or winner rather it is a game where everyone wins. parties of business doing businesses exchange money with each other and hence exchange is done on the basis of goods. one party takes the goods and other sales it so there is winner on both sides. each party values more highly the good it gets than the good it gives up. both sides exchange only because both intend to increase their value. so there is no concept of lose or win.

agriculture and oil. natural resources, industry.