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Calculate supply function based on production or cost function
Q1: A company has the following production function:
$$f(x_1,x_2) = 2x_1 + x_2$$.
The factor prices are $w_1=4$ and $w_2=3$. Calculate the company's supply function.
Q2: A company's cost function is
$$...
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How change in technology affects the price of labour and capital?
If the technology improves how does the price of labour and capital change. We take the neo-classical assumption that demand for each factor depends on it's marginal productivity, and demand and ...
