A Publishing House Is Using 400 Printers and 200 Printing

question 15

Multiple Choice

A publishing house is using 400 printers and 200 printing presses to produce books.The printers' wage rate is $20,and the price of a printing press is $100.The last printer added 20 books to total output,while the last press added 50 books to total output.In order to maximize the number of books published with a budget of $28,000,the publishing house

• A)should continue to use 400 printers and 200 presses.
• B)should use more printers and fewer presses because printers cost less than presses.
• C)should use more printers and fewer presses because the last dollar spent on a printer yielded more output than the last dollar spent on a press.
• D)should use more presses and fewer printers because the marginal output of the last press was more than the marginal output of the last printer.
• E)should use more presses and fewer printers because the last dollar spent on a press yielded more output than the last dollar spent on a printer.

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Definitions:

Property Rights

Legal rights to possess, use, and dispose of assets, including real estate, intellectual property, or physical goods, crucial for the functioning of markets and economies.

Government Regulation

Rules and guidelines established by the government aimed at influencing or controlling certain activities within the society or economy.

Total Surplus

The total net gain to society from a market transaction, which is the combination of consumer surplus and producer surplus.

Consumer Surplus

The gap between the aggregate amount buyers are willing and able to spend for a good or service, versus what they actually spend.