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krok68 [10]
4 years ago
5

Suppose the production of solar powered lawn mowers is characterized by the production function Q = LE, where Q represents the n

umber of ornaments produced. Suppose that the price of labor is $10 per unit and the price of energy is $1 per unit. Find the cost-minimizing combination of labor and energy for a manufacturer that wants to produce 121,000 lawn mowers.
Business
1 answer:
RoseWind [281]4 years ago
7 0

Answer:

110 labor and 1100 energy

Cost of 2,200 dollars

Explanation:

Q = L x E

Cost = 10 L + E

We use Excel solver tool to get this

    A            B               C      

1                Labor Energy  

2 Quantity     110          1100

3 Cost             10               1

4 output    121,000  (B2 * C2)

5 cost           2,200 (B2*B3 + C2*C3)

we want to minimize B5 (cost)

changing the quantities (b2:c2)

with the constrain that output b4= 121,000

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