If the Cobb-Douglas Production Function for a Beer Manufacturer Is

question 18

Multiple Choice

If the Cobb-Douglas production function for a beer manufacturer is q=1.52L⁰.⁶K⁰.⁴.If we assume that the firm's capital is fixed at 250 units and the rental rate of capital is $5 per unit,then average fixed cost is

• A) $1250.
• B) $1250/q.
• C) 1.52L⁰.⁶(250)⁰.⁴.
• D) Unable to determine with information given.

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