The Production Function Is Given by F(x)= 4x^1/2

question 4

Multiple Choice

The production function is given by f(x) = 4x^1/2.If the price of the commodity produced is $60 per unit and the cost of the input is $20 per unit, how much profit will the firm make if it maximizes profits?

• A)$1,444
• B)$705
• C)$720
• D)$358
• E)$363

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Definitions:

Market Rate

The current price or interest rate at which goods, services, or securities are bought and sold in a competitive marketplace.

Bond Selling Price

The market price at which a bond is traded, which may be above (premium) or below (discount) its face value.

Par Value

The nominal or face value of a security or currency, as stated by the issuer.

Market Rate

The current price or rate at which goods, services, or securities are traded in the open market.