Question
What is the long-run cost function if the production function is $q=5 L+K ?$
Step 1
In this case, the production function is $q=5L+K$. We differentiate $q$ with respect to $L$ and $K$ to get the marginal products. The marginal product of labor is 5 and the marginal product of capital is 1. Therefore, the MRS is 5. Show more…
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