Assume Your Company Produces Good X Using Only Two Inputs

question 1

Multiple Choice

Assume your company produces good X using only two inputs, capital (K) and labor (L) . Also, assume L is measured on the vertical axis and K on the horizontal one. If the prices of inputs are P_K=$30 and P_L=15, and your company is behaving efficiently, what is the slope of the isoquant at the current input mix?

• A) -2
• B) -1/2
• C) 2
• D) 1/2

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Definitions:

Walmart

A multinational retail corporation operating a chain of hypermarkets, discount department stores, and grocery stores, known for its extensive product selection and low prices.

Corporate Vertical Marketing System

A structured form of marketing system where subsequent stages of production and distribution are under a single ownership.

Parent Company

A company that owns enough voting stock in another firm to control management and operations by influencing or electing its board of directors.

Retail Outlets

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