# Cost under linear programming assumptions?

topics on the managerial economics

Under linear programming, the production funtions are chraterised by fixed proportion of all relevant inputs. So, average and marginal variable cost of each activity is the same, irrespective of the level of output.

Alternatively, work with limited resources of n types and maximise the value of output, the dual gives the shadow prices of the resouces. Noe compute the cost of the LP solution output.

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**Answer:**Under linear programming, the production funtions are chraterised by fixed proportion of all relevant inputs. So, average and marginal variable cost of each activity is the same, irrespective of the level of output.

Alternatively, work with limited resources of n types and maximise the value of output, the dual gives the shadow prices of the resouces. Noe compute the cost of the LP solution output.

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