A Firm Uses Two Inputs, Labor (L) and Capital (K)

question 49

Multiple Choice

A firm uses two inputs, labor (L) and capital (K) in the production of umbrellas.It can invest $50,000 in the purchase of the two inputs annually.The firm hires 5 units of capital at $1,000 per unit.If the going annual wage rate is $4,500, calculate the number of workers employed by the firm.(Assume that the firm spends the entire budget on K and L.)

• A)10
• B)5
• C)15
• D)9

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Definitions:

Annual Fee

A recurring charge paid yearly for the access to a product or service.

Software Production Costs

Expenses associated with the development, design, and implementation of software, which may be capitalized or expensed depending on the stage of development.

Technological Feasibility

The point at which it can be demonstrated that a new technology will function as intended.

Marketed

The process of promoting or selling goods and services, including market research and advertising.