If Output Is Produced According to Q = 4LK, the Price

question 28

Multiple Choice

If output is produced according to Q = 4LK, the price of K is $10, and the price of L is $40, then the cost minimizing cost minimizing combination of K and L capable of producing 64 units of output is

• A)L = 16 and K = 1.
• B)L = 2 and K = 8.
• C)L = 2 and K = 2.
• D)L = 32 and K = 32.
• E)L= 1 and K = 16.

---

Definitions:

Worst Recession

A particularly severe or damaging period of economic decline, characterized by significant decreases in GDP, high unemployment, and failing businesses.

Depression

An economic depression is a prolonged period of significant decline in economic activity across a region or country, characterized by high unemployment, low consumer spending, and a decrease in industrial production.

National Output

The total value of all goods and services produced within a country's borders in a given time period.

Stagflation

A period of slow economic growth combined with high unemployment and rising prices (inflation).