Question 31 (7 marks): A monopolist has the following production function Q = L0.5K0.5 where L is the number of units o

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Question 31 (7 marks): A monopolist has the following production function Q = L0.5K0.5 where L is the number of units o

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Question 31 (7 marks):
A monopolist has the following production function Q =L0.5K0.5 where Lis the number of units of labour and K is the number of units ofcapitalused in the production process. Suppose that the cost per unit oflabour is$3 and the cost per unit of capital is $27 and the monopolist takestheinput prices as given. Assume the market demand is P = 24 - Q.
If the monopolist is going to maximise the profit, how much outputwillthey produce? How many units of labour and capital is the firmgoing toemploy? How much profit is the firm going to earn?
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