How Much Capital Does a Firm Require to Produce Q

question 62

Multiple Choice

How much capital does a firm require to produce q = 3200 when labor is 4 and they have a production function equal to q = 200L^0.5K^0.5?

• A) K = 64
• B) K = 8
• C) K = 16
• D) K = 25

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Definitions:

Franchisee

An individual or company that acquires the rights from a franchisor to operate a business under the franchisor's brand and system.

Salaried Manager

An individual in a managerial position who receives a predetermined, regular payment, typically on a monthly or bi-weekly basis, regardless of hours worked.

Profits

The financial return that exceeds the input costs associated with generating revenue, a fundamental measure of the success and viability of a business venture.

Franchise Fee

An upfront payment made by a franchisee to a franchisor for the rights to use the franchisor's brand and business model.