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Perfect Substitutes Question?
I have an economic problem that says you can make 1 lemonade with 5 large lemons or you can make one lemonade with 10 small lemons where x is the number of large lemons and z is the number of small lemons.
in the answer it says that the production function is f(xz)= x + (z/4)
i'm confused about how to get the production function, where does the four come from? I thought the answer would be f(xz)= x + (z/2) because one unit of x is worth 1/2 unit of z.
can anyone explain to me how this is the answer
TIA
1 Answer
- Anonymous7 years ago
Good question