1.-The condition that best describes the producer's equilibrium is

a.-producer reaches maximizing production and minimizing costs.

b.- producer reaches maximize production and costs.

c.- Isocost must cross isoquant.

d.- Isocost must equal to isoquant.

2.- Assume you have two isocost lines, with the following combinations:

Isocost 1(10, 0) and (0, 20)

Isocost 2(15, 0) and (0, 30)

Then,

a.- Budget in isocost 1 is greater than isocost 2.

b.- Budget in isocost 2 is greater than isocost 1.

3.- Isocost shows all combinations of input that lets the producer visualizes the production level.

a.- True

b.- False

4.- The following table shows different combinations of units of labor and capital.

Labor 0.75 1 2 3 4 5 6

Capital 7.5 6 3 2 1.75 1.5 1.25

This represents:

a.- isoquant curve.

b.- production function.

c.- isocost line.

d.- total cost function.

5.- The following table shows different combinations of units of labor and capital.

Labor 0.5 1 1.5 2 2.5 3 3.25

Capital 6 5 4 3 2 1 0.5

This represents:

a.- isocost line.

b.- production function.

c.-total cost function.

d.- isoquant curve

6.-Tree, Inc. is a firm that produces wood. The managers decide to use 19 units of labor and 10 units of capital, and the CEO determines that the formula 2.3K^0.75L^0.25will be used to determine the tons of wood. How many tons of wood the CEO is expecting?

a.- 37.2 tons

b.- 16.2 tons

c.- 27 tons

d.- 8.2 tons

7.- The Tree, Inc. managers decide to double the units of capital from 10 to 20. Using the information of the total of tons of wood that the CEO expects in the exercise before, how many units of labor the managers need to combine with the 20 units of capital to produce the tons that CEO expects?

a.- 5.1

b.- 2.4

c.- 9.8

d.- 38