The Production Function Is F (L, M) = 4

question 6

Multiple Choice

The production function is f (L, M) = 4 , where L is the number of units of labor and M is the number of machines. If the amounts of both factors can be varied and if the cost of labor is $64 per unit and the cost of using machines is $1 per machine, then the total cost of producing 20 units of output is

• A) $80.
• B) $650.
• C) $20.
• D) $320.
• E) $40.

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