Your automobile assembly plant has a Cobb-Douglas production function given by

Question

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where q is the number of automobiles it produced per year, x is the number of employees, and y is the daily operating budget (in dollars). Annual operating costs amount to an average of $30,000 per employee plus the operating budget of . Assume you wish to produce 1,500 automobiles per year at a minimum cost. How many employees should you hire?

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A. 180 employees

B. 75 employees

C. 30 employees

D. 150 employees

E. 225 employees

Answer 1

Answer: D