Question : 21) Suppose that capital costs $10 per unit and labour : 1384209

 

21) Suppose that capital costs $10 per unit and labour costs $5 per unit. For a profit-maximizing firm operating at its optimal factor mix, if the marginal product of capital is 50, the marginal product of labour must be

A) 10.

B) 20.

C) 25.

D) 50.

E) 100.

22) Suppose that capital costs $6 per unit and labour costs $3 per unit. If the marginal product of capital is 3 and the marginal product of labour is 6, the cost-minimizing firm should

A) employ more of both capital and labour.

B) employ less of both capital and labour.

C) employ more capital and less labour.

D) employ less capital and more labour.

E) not change its current factor use.

23) Suppose that capital costs $6 per unit and labour costs $3 per unit. If the marginal product of capital is 12 and the marginal product of labour is 6, the cost-minimizing firm should

A) employ more of both capital and labour.

B) employ less of both capital and labour.

C) employ more capital and less labour.

D) employ less capital and more labour.

E) not change its current factor use.

24) Suppose that capital costs $50 per unit and labour costs $20 per unit. If the marginal product of capital is 100 and the marginal product of labour is 30, a cost-minimizing firm should

A) employ more of both capital and labour.

B) employ less of both capital and labour.

C) employ more capital and less labour.

D) employ less capital and more labour.

E) not change its current factor use.

25) Suppose that capital costs $100 per unit and labour costs $40 per unit. If the marginal product of capital is 200 and the marginal product of labour is 60, a cost-minimizing firm should

A) employ more capital and less labour.

B) employ more of both capital and labour.

C) employ less of both capital and labour.

D) employ less capital and more labour.

E) not change its current factor use.

26) If a firm is using labour and capital such that the MP of labour is two times the MP of capital, and the price of labour is four times the price of capital, the firm should ________ in order to minimize its costs of producing its output.

A) increase capital and decrease labour

B) decrease both capital and labour

C) decrease capital and increase labour

D) increase both labour and capital

E) not alter its present factor mix

27) Suppose that capital costs $8 per unit and labour costs $4 per unit. For a profit- maximizing firm operating at its optimal factor mix, if the marginal product of capital is 60, the marginal product of labour must be

A) 10.

B) 20.

C) 30.

D) 90.

E) 120.

28) Suppose that capital costs $10 per unit and labour costs $4 per unit.  If the marginal product of capital is 50 and the marginal product of labour is 50, the firm should ________ in order to minimize its costs of producing its output.

A) employ more capital and labour

B) employ less capital and labour

C) employ more capital and less labour

D) employ less capital and more labour

E) not change its current factor use

29) Suppose a firm employs two kinds of inputs, capital at $100 per unit, and labour at $25 per unit. If the marginal product of capital is 50, then the firm should ________ in order to minimize its production costs.

A) employ more capital and less labour

B) employ more labour and less capital

C) employ more labour and more capital

D) not change its current factor use

E) There is insufficient information to make a recommendation.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30) Refer to Table 8-2. As this firm switches from production method A to production method G, production is

A) moving farther and farther away from cost minimization.

B) becoming more capital intensive and less labour intensive.

C) becoming more profitable.

D) becoming more labour intensive and less capital intensive.

E) remaining at a cost-minimizing level of output.

 

 

Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more