A Competitive Firm Uses Two Variable Factors to Produce Its

question 31

Multiple Choice

A competitive firm uses two variable factors to produce its output, with a production function q = min{x1, x2}.The price of factor 1 is $4 and the price of factor 2 is $5.Due to a lack of warehouse space, the company cannot use more than 17 units of x1.The firm must pay a fixed cost of $136 if it produces any positive amount but doesn't have to pay this cost if it produces no output.What is the smallest integer price that would make a firm willing to produce a positive amount?

• A)$36
• B)$33
• C)$21
• D)$9
• E)$17

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Definitions:

Epidermis

The outermost layer of cells covering an organism, particularly the skin of animals or the surface layer of plants.

Sebum

An oily substance produced by sebaceous glands in the skin, which helps to lubricate and waterproof the skin and hair.

Oil Glands

Specialized glands in the skin that produce and secrete oils to lubricate and waterproof the skin and hair.

Skin Supple

Describes skin that is soft, flexible, and moisturized, indicating health and hydration.