A Firm Produces Ping-Pong Balls Using Two Inputs

question 75

Multiple Choice

A firm produces Ping-Pong balls using two inputs.When input prices are ($15, $7) the firm uses the input bundle (17, 71) .When the input prices are ($12, $24) the firm uses the bundle (77, 4) .The amount of output is the same in both cases.Is this behavior consistent with WACM?

• A)Yes.
• B)No.
• C)It depends on the level of the fixed costs.
• D)We have to know the price of the output before we can test WACM.
• E)It depends on the ratio of variable to fixed costs.

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Definitions:

Independent Samples T-Test

A statistical test used to compare the means of two independent groups in order to determine if there is a statistically significant difference between them.

Dependent Samples T-Test

A statistical test used to compare the means of two related groups.

Regression

A statistical method used to model and analyze relationships between variables.

Obtained Value

The actual value or result achieved in an experiment or study, typically used in statistical analysis to compare against theoretical values.