ASSIGNMENT
A iniktt ha’ s t WO consumers With diii 1 dt tn,nid curves. The first. Consumer has demand of Di(p) rz 12 – p, The second 4- 2p. A firm with market power has .1 production function of f(K,L) = K'”2L1″2.
- a) Find the factor demand functions for K and L for a single firm tn this market. Circle your two demand functions.
- b) Assume the price of capital is $4 per unit and the price of Labor is Si per unit. What is a single firm’s total cost function as a function of quantity.
- c) Solve for the firm’s profit maximizing price if they can only set one price for the entire market. d) What is the total number of units sold in this market?
