13. Suppose your budget is $100, the price of capital is and the price of capital r=$10, and the price of labor, w=$5. Suppose that if you pay a fee of $20 you get a "buy-one-get one free discount" on capital; the wage rate also rises to $10. If you spend all your money in one input (either labor or capital), what is the maximum amount of capital that you can afford after these changes? a. L=16; K=16 b. L=10; K=20 c. L=10; K=16 d. L=8; K=16 Drw bour whi information:

13. Suppose your budget is $100, the price of capital is and the price of capital r=$10, and the price of labor, w=$5. Suppose that if you pay a fee of $20 you get a "buy-one-get one free discount" on capital; the wage rate also rises to $10. If you spend all your money in one input (either labor or capital), what is the maximum amount of capital that you can afford after these changes? a. L=16; K=16 b. L=10; K=20 c. L=10; K=16 d. L=8; K=16 Drw bour whi information:

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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