Suppose That Nadine Has a Production Function 4x₁

question 7

Multiple Choice

Suppose that Nadine has a production function 4x₁ + x₂.If the factor prices are $4 for factor 1 and $2 for factor 2, how much will it cost her to produce 70 units of output?

• A)$700
• B)$1,260
• C)$140
• D)$70
• E)$105

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Definitions:

Journal

A record where all financial transactions of a business are initially noted before they are transferred to ledger accounts.

Ledger

A comprehensive collection of a company's accounts, documenting all transactions and financial results.

Chart of Accounts

An organized list of all accounts in the general ledger of a company, each with a unique account number, used for recording transactions and preparing financial statements.

Book of Original Entry

A preliminary accounting record where transactions are first recorded; also known as a journal.