Find a value of the lagrange multiplier

Reference no: EM13183189

A perfectly competitive firm sells two goods. A price for the first good is £54. A price for the second good is £22. The total cost for a firm is given by the expression:

TC (Q1, Q2) = 3Q1^2 + 2Q1Q2 + (½) Q2^2 + 6Q1

a) Find the maximum profit and the optimal values of Q1 and Q2.

b) If the firm can not produce in total more than 14 units, then what would be the maximum profit and the optimal values of Q1 and Q2? Find an answer using the Lagrange multiplier. Find a value of the Lagrange multiplier. What economic interpretation has the Lagrange multiplier in this context?

Reference no: EM13183189

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