An Investor Who Has a Resource Constraint

question 40

Multiple Choice

An investor who has a resource constraint:

• A)pays no income taxes.
• B)has insufficient funds to purchase a security.
• C)has a relatively high marginal tax rate.
• D)has only one source of income.
• E)will only invest in socially acceptable securities.

---

Definitions:

Production Function

An equation that specifies the output that a firm can produce with varying combinations of inputs, such as labor and capital.

Supply Function

A mathematical relationship that describes the quantity of goods that producers are willing and able to sell at different prices.

Cost Function

A mathematical formula used to calculate the total cost incurred by a company to produce a given level of output.

Maximizing Profits

The process by which a company determines the price and production level that generates the most profit.