Problem

In the previous problem, what is the minimum-cost method of producing 100 machines? (Ign...

In the previous problem, what is the minimum-cost method of producing 100 machines? (Ignore the $10,000 budget constraint.)

(Reference Problem 50)

It costs a company $12 to purchase an hour of labor and $15 to purchase an hour of capital. If L hours of labor and K units of capital are available, then 0.05L2/3K1/3 machines can be produced. Suppose the company has $100,000 to purchase labor and capital.

a. What is the maximum number of machines it can produce?

b. Use SolverTable to see how a change in the price of labor changes the optimal solution.

c. Use SolverTable to see how a change in the price of capital changes the optimal solution.

d. Use SolverTable to see how a change in the amount of money available changes the optimal solution.

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