Finding the Least-Cost Production Mix

Your business could be losing money right now and you don't even know it.

Here's the secret: there's a perfect combination of workers and machines that costs the least

to produce anything. Think about it like making coffee. Too many baristas with basic equipment

wastes money on wages. Too many fancy machines with few workers means expensive

equipment sitting idle. The sweet spot is where your cost per unit hits rock

bottom. This is called the least cost combination and it's literally the difference between

profit and loss. Companies use something called isoquants to map this out, finding exactly

where labor and capital intersect at minimum cost. Master this and you're not just