A Firm's Production Function Is Given by Q = Min{M

question 27

Multiple Choice

A firm's production function is given by q = min{M, L^1/2}, where M is the number of machines and L is the amount of labor that it uses.The price of labor is $1and the price of machines is $4 per unit.The firm's long-run marginal cost curve is

• A)upward sloping and gets flatter as Q increases.
• B)a straight line with slope 2.
• C)a straight line with slope 1.
• D)upward sloping and gets steeper as Q increases.
• E)a straight line with slope 4.

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Definitions:

Economic Growth

An increase in the production of goods and services in an economy over a period, often measured by the rise in the gross domestic product (GDP).

Corruption

The abuse of entrusted power for private gain, which can occur in both the public and private sectors.

Poor Administration

Inefficient or ineffective management practices within an organization or government, often leading to suboptimal results, waste, or failure to meet objectives.

Nationalization

The process by which a government takes ownership and control of private assets or industries, often to ensure public access or control.