2. A firm requires labor and capital to produce a given output. Labor costs $8 0/6 per hour and capital costs $12 per hour. At the current level of output, the marginal product of labor is 48 and the marginal product of capital is 60. To minimize production costs, in which way should the firm allocate its resources?" Labor Capital a. Increase increase b. Increase decrease C. No change increase d. Decrease no change e. No change no change
2. A firm requires labor and capital to produce a given output. Labor costs $8 0/6 per hour and capital costs $12 per hour. At the current level of output, the marginal product of labor is 48 and the marginal product of capital is 60. To minimize production costs, in which way should the firm allocate its resources?" Labor Capital a. Increase increase b. Increase decrease C. No change increase d. Decrease no change e. No change no change
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter12: The Cost Of Production
Section: Chapter Questions
Problem 3PA
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A firm requires labor and capital to produce a given output. Labor costs $8 per hour and capital costs $12 per hour. At the current level of output, the marginal product of labor is 48 and the marginal product of capital is 60. To minimize production costs, in which way should the firm allocate its resources?
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