The Cobb-Douglas production model follows from certain econo
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The Cobb-Douglas production model follows from certain economic assumtions, where k and are positive constant and . If t
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The Cobb-Douglas production model follows from certain economic assumtions, where k and are positive constant and . If the cost of a unit of labor is "m" and the cost of a unit of capitol is "n," and the company can only spend "p" dollars as its total budget, then maximizing the production "P" is subject to the constraint . Show that the maximum production occurs when and . I know to set up so that where , but I am having a really difficult time solving this system of equations, so if you could please go through that part in detail, it would be greatly appreciated. Thanks very much in advance!
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