A firm sells its output in a perfectly competitive market and hires two inputs, capital and labor, in perfectly competitive factor markets. The product price is $15 per unit, the wage is $75 per day, and the marginal product of capital is 3. If the firm is choosing the least-cost combination of labor and capital, the firm's marginal product of labor and the price of capital must be equal to which of the following? (A) (B) (C) (D) (E) Marginal Product of Labor 25 25 755 5 Price of Capital $5 $45 $15 $25 $45

A firm sells its output in a perfectly competitive market and hires two inputs, capital and labor, in perfectly competitive factor markets. The product price is $15 per unit, the wage is $75 per day, and the marginal product of capital is 3. If the firm is choosing the least-cost combination of labor and capital, the firm's marginal product of labor and the price of capital must be equal to which of the following? (A) (B) (C) (D) (E) Marginal Product of Labor 25 25 755 5 Price of Capital $5 $45 $15 $25 $45

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

56. A firm sells its output in a perfectly competitive
market and hires two inputs, capital and labor, in
perfectly competitive factor markets. The product
price is $15 per unit, the wage is $75 per day, and
the marginal product of capital is 3. If the firm is
choosing the least-cost combination of labor and
capital, the firm's marginal product of labor and
the price of capital must be equal to which of the
following?
(A)
(B)
(C)
(E)
Marginal Product of Labor Price of Capital
23555
$5
$45
$15
$25
$45

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please calculate highlighted fields?
Is this correct?
Match the terms in the first column with the appropriate definition in the second column.
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