Math Problem Statement
Solution
To solve this problem, let’s break down each component step-by-step to find the optimal use of labor and capital to maximize the weekly profit.
Problem Breakdown
-
Available Resources and Costs:
- 160 hours of labor are available weekly at $15 per hour.
- Additional labor costs $25 per hour if more than 160 hours are required.
- Capital is available at $45 per unit with no quantity limitation.
-
Production Function:
- The production function for the number of machines produced is given by:
- Here, represents the labor hours and represents the units of capital.
-
Revenue:
- Each machine sells for $270.
- Therefore, the revenue from producing machines is:
-
Cost Function:
- The cost of using labor (up to 160 hours) is if .
- If , the cost for the first 160 hours is , and additional labor hours cost $25 per hour.
- The cost of capital is .
-
Profit Function:
- Profit, , is given by:
- Therefore:
-
Objective:
- Maximize with respect to and .
Steps to Solve
To solve this optimization problem, we can use methods from calculus, specifically partial derivatives and setting up a Lagrange multiplier if there’s a budget constraint. Here’s the step-by-step approach:
-
Express Labor Cost Function:
- For simplicity, we will handle two cases:
- Case 1: , so labor cost .
- Case 2: , then .
- For simplicity, we will handle two cases:
-
Write Down the Profit Function for Each Case.
-
Find the Partial Derivatives:
- Take partial derivatives of with respect to and and set them to zero to find the critical points.
-
Analyze Solutions:
- Calculate profit for each case and determine which values of and maximize .
Would you like a detailed step-by-step calculation based on these steps, or should I proceed with specific parts of the problem?
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Math Problem Analysis
Mathematical Concepts
Calculus
Optimization
Production Function
Cost Function
Revenue and Profit Maximization
Formulas
Production function: Q = L^(1/2) * K^(1/3)
Revenue function: R = 270 * Q
Labor cost (if L <= 160): C_L = 15 * L
Labor cost (if L > 160): C_L = 15 * 160 + 25 * (L - 160)
Capital cost: C_K = 45 * K
Profit function: Π = Revenue - Total Cost
Theorems
Optimization using Partial Derivatives
Suitable Grade Level
University Level (Economics/Business/Advanced Mathematics)
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