Suppose firms A and B each make T-shirts.Firm A's production function is q = L^0.5K^0.5.Firm B's production function is q = 1.2 ∗ L^0.5K^0.5.If the two firms each hire the same amounts of capital and labor,compare the two firms in terms of AP_L and MP_L.

Question

Quizplus · Accepted Answer

The Answer of Suppose firms A and B each make T-shirts.Firm A's production function is q = L^0.5K^0.5.Firm B's production function is q = 1.2 ∗ L^0.5K^0.5.If the two firms each hire the same amounts of capital and labor,compare the two firms in terms of AP_L and MP_L.

Suppose Firms a and B Each Make T-Shirts