Suppose That a Firm Makes Gears (G) and Axles (A)

question 110

Multiple Choice

Suppose that a firm makes gears (G) and axles (A) . Each gear requires 15 minutes of labor and each axle requires 30 minutes of labor. One thousand hours of labor are available. How should the labor constraint(s) be written?

• A) G + A ≤ 1000
• B) .25G + .5A ≤ 1000
• C) G ≤ 15 and A ≤ 30
• D) .25G + .5A ≥ 1000
• E) 15G + 30A ≤ 1000

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Definitions:

Minimum ATC

The point at which a firm's average total cost is at its lowest, typically considered in the context of the long-run average cost curve.

Purely Competitive Market

A market structure characterized by many buyers and sellers, free entry and exit, and a product that is homogeneous across suppliers.

Short Run

A period of time during which at least one input, like equipment or labor, is fixed while others can be varied to change output levels.

Automatic Market Adjustments

The self-regulating behavior of markets where prices and quantities adjust to changes in demand and supply conditions without external intervention.