The Production Function Is F(x₁, X₂)=x^1/2₁x^1/2₂

question 2

Multiple Choice

the production function is f(x₁, x₂) =x^1/2₁x^1/2₂.If the price of factor 1 is $4 and the price of factor 2 is $6, in what proportions should the firm use factors 1 and 2 if it wants to maximize profits?

• A)x₁ =x₂.
• B)x₁ = 0.67x₂.
• C)x₁ =1.50x₂.
• D)We can't tell without knowing the price of output.
• E)x₁ =6x₂.

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Definitions:

Unsaturated Fatty Acid

A fatty acid that contains one or more double bonds between carbon atoms, which can influence the fluidity of cell membranes and are often found in plant oils.

Saturated Fatty Acid

A type of fatty acid where all carbon atoms are bonded to hydrogen atoms, without any double bonds.

Lecithin

A fatty substance found in plant and animal tissues, used as an emulsifier in food products, as well as in pharmaceutical and cosmetic formulations.

Triglyceride

A type of fat (lipid) found in your blood, made up of three fatty acids and glycerol.