00:01
So here we're given this unusual non -differential production function and we're asked a series of questions, right? in a, we're asked if labor is equal to four and capital is equal to nine.
00:11
How much output do we get? well, we just plug that into our production function, right? minimum of nine, two times four, and that is eight, right? so that's basically it, right? you plug into the production function.
00:27
The key thing is here is that the ninth unit of capital is useless.
00:30
Right? if i replaced this with eight, it wouldn't change the production.
00:34
This firm has too many machines.
00:37
For b, we are now inviting a consultant, wonderful.
00:42
The firm is now, we're going to assume that the wage is 40...