Quiz 5

Q:  Assuming F(L,K)=L1/2K1/3, w=3 and v=2, find TC and MC.

A:  Setting the RTS = w/v we have 3K/2L=3/2 or K=L.  Therefore, q=L1/2L1/3=L5/6.  So L=q6/5 and TC= wL+vK=3*q6/5 +2*q6/5  = 5q6/5.  MC=dTC/dq=6q1/5.