A Firm with the Production Function F (X1, X2, X3

question 46

Multiple Choice

A firm with the production function f (x1, x2, x3, x4) =min{x1, x2, x3, x4} faces input prices w1 = $1, w2 = $5,w3 = $5, w4 = $3 for factors 1, 2, 3, and 4. The firm must use at least 10 units of factor 2. The lowest cost at which it can produce 100 units of output is

• A) $800.
• B) $440.
• C) $1,400.
• D) $770.
• E) $400.

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Definitions:

Income Statement

A financial statement that shows a company's revenue and expenses over a specific period, resulting in a net profit or loss.

Statement of Retained Earnings

A financial statement that shows how a company's retained earnings have changed over a given period due to profits retained in the business or dividends distributed.

Adjusted Trial Balance

A trial balance that accounts for all adjustments made in the accounting period, used for preparing financial statements.

General Ledger Accounts

The complete record of all financial transactions over the life of a company, organized by account.