Suppose a Production Function for a Firm Takes the Following

question 18

Multiple Choice

Suppose a production function for a firm takes the following algebraic form: Q = 2KL - (0.2) L²,where Q is the output of sweaters per day.Now suppose the firm is operating with 8 units of capital (K =8) and 10 units of labour (L=10) .What is the output of sweaters?

• A)30 sweaters per day
• B)60 sweaters per day
• C)80 sweaters per day
• D)140 sweaters per day
• E)155 sweaters per day

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Definitions:

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A measure of how much the quantity demanded of a good responds to a change in price, indicating the sensitivity of demand to price changes.

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