A Firm's Production Function Is F(x1, X2)= (Min{x₁, 4x₂})^1/2

question 12

Multiple Choice

A firm's production function is f(x1, x2) = (min{x₁, 4x₂}) ^1/2.If the price of factor 1 is w1 = $5 per unit and the price of factor 2 is w2 = $8 per unit, then its supply function is given by the equation S(p) =

• A)7p.
• B)p/14
• C)min{w1, 4w2}p.
• D)max{w1, 4w2}p.
• E)min{5p, 32p}p.

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Definitions:

Judgment

The ability to make considered decisions or come to sensible conclusions based on a comprehensive analysis of available information.

Association Heuristic

A mental shortcut that relies on the immediate connections between two concepts or objects in the mind to make a decision or solve a problem.

Error

A mistake or discrepancy from accuracy or correctness in reasoning, action, or calculation.

Judgment

The skill to arrive at well-thought-out decisions or logical conclusions.