The Production Function Is F(L, M)= 4L^1/2 M^1/2, Where L

question 12

Multiple Choice

the production function is f(L, M) = 4L^1/2 M^1/2, where L is the number of units of labor and M is the number of machines used.If the cost of labor is $49 per unit and the cost of machines is $36 per unit, then the total cost of producing 4 units of output will be

• A)$84.
• B)$170.
• C)$144.
• D)$168.
• E)None of the above.

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Definitions:

Fixed Costs

Expenses that do not change with the level of production or sales in the short term, such as rent, salaries, and insurance.

Variable Costs

Costs that vary directly with the level of production or sales, such as materials and labor.

Corporate Tax Rate

The percentage of a corporation's profits that is paid to the government as tax.

Recession

A significant decline in economic activity spread across the economy, lasting more than a few months, typically visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.