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

question 14

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 = $15, then her supply function is given by the equation

• A)S(p)= p/14.
• B)S(p)= p(max{w₁, 3w₂})².
• C)S(p)= p(min{w₁, 3w₂})².
• D)S(p)= 7p.
• E)S(p)= min{2p, 45p}.

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Definitions:

Term To Maturity

The length of time until the principal amount of a bond or other debt instrument is due to be repaid.

Yield To Maturity

The total expected return on a bond if held until its maturity date, expressed as an annual rate.

Coupon Rate

The annual interest rate paid by a bond relative to its face value, expressed as a percentage.

Duration-based Immunization

A strategy used in portfolio management to minimize the risk of interest rate fluctuations by matching the duration of assets and liabilities.