You own a farm, you hire labor and capital to produce apples. The marginal product of the last unit of labor input is 15 and the marginal product of the last unit of capital input is 45. The market wage for labor is $8. If you are using the optimal combination of inputs, then the price of capital is?

Select one:

a.

$45

b.

$360

c.

$24

d.

$3

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If your firm is currently hiring capital and labor so that: (MPL/PL)

Select one:

a.

hire less labor and more capital

b.

hireless labor and less capital

c.

hiremore capital and more labor

d.

hiremore labor and less capital

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You own a company that produces pens. The marginal product of the last unit of labor input is 25 and the marginal product of the last unit of capital input is 75. The market wage is $10, if your company is using the optimal combination of inputs, then the price of capital is

Select one:

a.

$250

b.

$30

c.

$750

d.

$187.5

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The most efficient manner for a firm to use its inputs, X and Y:

Select one:

a.

WhenMPx = MPy

b.

When MPx/Py = MPy/Px

c.

WhenMPx/MPy = Px/Py

d.

WhenPx = Py and MPx = MPy

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When we read the term Production Function, it refers to:

Select one:

a.

the relationship between costs and output

b.

the role of labor unions

c.

the relationship between inputs and output

d.

the use of machinery and equipment in production

Capital Figure 1 (units) Capital 24 (units) 20 LE 16 C KA Kc 10 Labor (units) La Lo Le Labor (units) Refer to Figure 2. The lines shown in the diagram are isogost lines. Which of the Refer to Figure 1. The movement from isoquant T to isoquant U depicts following shows an increase in the price of labor while the price of capital remains Select one: unchanged? Select one: 90 increase in output the movement from BF to CE b a change in preferences with regards to input usage b r the movement from AF to CE so increase in the cost of production C the movement from BF to BD d so increase in labor usage holding capital and output constant the movement from AF to BDCapital Capital (units) (units) A 240 20 16 C 9 10 Labor 14 Q = 200 (units) 7 Q= 144 Refer to Figure 2. The lines shown in the diagram are isoogst lines. Which of the Q = 100 following shows a decrease in the price of capital while the price of labor remains unchanged? 0 10 20 40 60 70 Labor Select one: hours Refer to Figure 3. What is the combination of inputs that produces 200 gooseberry pies the movement from AF to BF at the lowest cost? C Select one: the movement from BF to BD combination g: 60 hours of labor and 14 units of capital the movement from BF to AF combination e: 10 hours of labor and 48 units of capital C the movement from BF to CE combination h: 80 hours of labor and 9 units of capital combination, f. 40 hours of labor and 24 units of capitalCapital (units) 56 48 24 14 h Q = 200 9 Q = 144 Q = 100 0 10 20 40 60 70 Labor hours Refer to Figure 3. Suppose Hilda hires labor at $8 per hour and capital costs $10 per unit. What is the minimum cost of producing 200 gooseberry pies? Select one: r $592 $560 C. $3.600 r d $1.120