Suppose That Irma's Production Function Is F(x₁, X₂)=(min{x₁, 3x₂})^1/2

question 1

Multiple Choice

suppose that Irma's production function is f(x₁, x₂) =(min{x₁, 3x₂}) ^1/2.If the price of factor 1 is w₁ = $2 and the price of factor 2 is w₂ = $6, then her supply function is given by the equation

• A)S(p)=p(max{w₁, 3w₂})².
• B)S(p)= 4p.
• C)S(p)=p(min{w₁, 3w₂})².
• D)S(p)= p/8.
• E)S(p)= min{2p, 18p}.

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Definitions:

Consideration

The exchange of something of value in return for the promise or service of another party, a fundamental component of a valid contract.

Promise

A declaration or assurance by one party to another that a particular action or condition will occur or be met, potentially forming the basis of a contractual obligation.

Consideration

Something of value that is promised, given, or done that persuades a party to enter into a contract, making the contract legally enforceable.

Contract

A legally binding agreement between two or more parties that is enforceable by law.