Suppose a Firm Is Using 100 Units of Labour and 50

question 40

Multiple Choice

Suppose a firm is using 100 units of labour and 50 units of capital to produce 200 completed client tax returns per day.The price of labour is $10 per unit and the price of capital is $5 per unit.The MP_L equals 2 and the MP_K equals 5.In this situation,

• A)the firm is minimizing its costs.
• B)the firm should increase the use of both inputs.
• C)the firm could lower its production costs by decreasing labour input and increasing capital input.
• D)the firm could lower its production costs by increasing labour input and decreasing capital input.
• E)the firm should decrease the use of both inputs.

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Definitions:

Hinge Joint

A type of synovial joint that allows movement in one plane, similar to the motion of a door hinge, commonly found in the knee and elbow.

Anterior Fontanel

The largest and most notable soft spot on a baby's skull, which eventually closes as the skull bones fuse.

Sagittal Suture

A fibrous joint that connects the two parietal bones of the skull along the midline, resembling a seam, contributing to the skull's rigidity and shape.

Synovial Fluid

A viscous, non-Newtonian fluid found in the cavities of synovial joints, serving to reduce friction between the articular cartilages during movement.