Consider a simple production function Q(K.L) = K L, where K and L stand for capital and labour respectively.

Consider a simple production function Q(K.L) = K L, where K and L stand for capital and labour respectively. The unit prices of these factors are 2 and 3 monetary units, respectively (capital needs to be financed, for example with a loan, so it has a cost). The company has 24 monetary units to spend on the factors K and L.

(a) Compute the values of K and L that will maximise the production, assuming the company spends the 24 monetary units fully.

(b) How will the maximum production change if the company had 25 monetary units to spend?