A Firm Is Currently Producing 200 Units of Output Using

question 20

Multiple Choice

A firm is currently producing 200 units of output using 60 hours of labor and 80 hours of capital.The marginal product of labor is 12 units of output per hour,and the marginal product of capital is 15 units of output per hour.If the wage rate is $6 per hour and the rental rate is $3 per hour,then

• A) the firm's use of labor and capital is cost-efficient.
• B) the firm should use more labor and less capital.
• C) the firm should use more capital and less labor.
• D) we cannot determine if the firm's use of inputs is efficient without more information.

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Definitions:

Non-Hispanic White

Refers to people from the United States who are not Hispanic or Latino and identify as having origins in any of the original peoples of Europe, the Middle East, or North Africa.

African American

Pertaining to or descriptive of Americans of African descent with ancestry primarily linked to sub-Saharan Africa.

Hispanic American

An individual of Cuban, Mexican, Puerto Rican, South or Central American, or other Spanish culture or origin, regardless of race, living in the United States.

Cognitive-behavioral Therapy

A form of psychotherapy that focuses on changing negative thought patterns and behaviors to improve emotional regulation and develop personal coping strategies targeting solving current problems.