If the Price of the Output Good Is $4, the Price

question 11

Multiple Choice

if the price of the output good is $4, the price of factor 1 is $1, and the price of factor 2 is $3, what is the profit-maximizing amount of factor 1?

• A)8
• B)2
• C)1
• D)0
• E)There is not enough information to tell.

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Definitions:

Utility-Maximizing

The economic principle that individuals seek to obtain the greatest utility or satisfaction from their consumption choices.

Peanut Butter

A paste or spread for food, created from peanuts that are dry-roasted and then ground.

Broccoli

A green plant from the cabbage family, known for its edible flower heads and stalk.

Diminishing Marginal Utility

The principle that as a person consumes more of a good or service, the satisfaction gained from consuming additional units declines.