Touchie McFeelie from Your Workbook Has a Production Function (0

question 17

Multiple Choice

Touchie McFeelie from your workbook has a production function (0.1) , where J is the number of old jokes used and L is the number of hours of cartoonists' labor. Touchie is stuck with 400 old jokes for which he paid 6 dollars each. If the hourly wage rate for cartoonists is 4 dollars, then the total cost of producing 16 comics books is

• A) 2,464 dollars.
• B) 1,232 dollars.
• C) 2,480 dollars.
• D) 3,696 dollars.
• E) 616 dollars.

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Definitions:

Total Utility

The total satisfaction or benefit received by consuming a particular quantity of a good or service.

Demand Curve

A visual depiction showing how the demand for a product or service varies with changes in its price over a specific time frame.

Consumer Surplus

The gap between the total sum consumers are ready and able to spend on a good or service versus the total sum they actually spend.

Consumer Surplus

The difference between what consumers are willing to pay for a good or service relative to its market price, representing the economic benefit to consumers.