Suppose That Capital Costs $6 Per Unit and Labour Costs

question 41

Multiple Choice

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 capital and less labour.
• B) employ less of both capital and labour.
• C) employ more of both capital and labour.
• D) employ less capital and more labour.
• E) not change its current factor use.

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Definitions:

Withdrawal Reflex

A spinal cord-mediated reflex that causes immediate withdrawal from a painful or harmful stimulus.

Muscle Tension

The force generated by a muscle or group of muscles when they contract, which can vary in response to different stimuli or during different types of physical activity.

Dermatomal Maps

Diagrams that show the area of skin supplied by sensory nerves stemming from a single spinal nerve root.

Nerve Damage

Injury to the nerves, often resulting in loss of movement, sensation, or function in the affected area.