Suppose Woody Chuck's Business Is to Clear Trees for Housing $q = .01 \sqrt { L }$

question 3

Multiple Choice

Suppose Woody Chuck's business is to clear trees for housing developments.Given the constraints of fixed capital,the production function is $q = .01 \sqrt { L }$ .Suppose Woody Chuck's is one of many firms clearing land and that the market price per cleared lot is $5000.(Note $M P _ { L } = \frac { .005 } { \sqrt { L } }$ ) The marginal Revenue Product of labor is

• A)constant at $5000.
• B)constant at 25
• C) \(\frac { 25 } { \sqrt { L } }\)
• D) \(25 \cdot \sqrt { L }\)

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Definitions:

2 Years

A period of two calendar years.

Compounded Semi-Annually

Applying interest to both the initial principal and accumulated interest twice a year.

65 Years

A time period equivalent to sixty-five years, often referenced in discussions of age or time to retirement.

Common Stock

A type of security that represents ownership in a corporation and gives holders voting rights, as well as a share in the company's profits via dividends.