Lego boxes: A box of Legos consists of complex bricks and basic bricks.
The production function of Lego boxes is assumed to be:
Y = (B1^(2/3))*(B2^(1/3))
Where B1 denotes the number of basic bricks and B2 the number of complex bricks. Boxes of Legos are assembled in Denmark, combining these complex and basic bricks.
– Assuming that the Lego company optimizes its production, explain why the relative price of a complex brick relative to a basic brick should be equal to the ratio of marginal product of a complex brick over the marginal product of a basic brick.
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