A Firm's Production Function Is Given by Q = KL

question 23

Multiple Choice

A firm's production function is given by Q = KL, where MP_L = K and MP_K = L. The wage rate (W) = $50, and the rental per unit of capital (R) is $12.50. In the short run, capital (K) is fixed at 10 units. The short-run average total cost of producing 100 units of output is _____, and the long-run average total cost of producing 100 units of output is _____.

• A) $14.75; $8.80
• B) $6.25; $5
• C) $6.25; $4.20
• D) $14.75; $9

---

Definitions:

Electric Vehicle

A vehicle that is powered by an electric motor instead of an internal combustion engine, contributing to reduced carbon emissions and environmental pollution.

Carbon Dioxide Emissions

Refers to the release of carbon dioxide into the atmosphere, primarily due to fossil fuel burning and deforestation, contributing to global climate change.

Consumer Behavior

The study of how individuals, groups, and organizations select, buy, use, and dispose of goods, services, ideas, or experiences to satisfy their needs and wants.

Reference Groups

Groups that individuals refer to when making purchasing decisions or when evaluating their personal qualities.