A firm uses inputs L and K to produce and good Q. The production function is Q-0.5LK. In the short-run, K is fixed at 20 units, the price of labor is PL $14 and the price of capital is PK - $6. The total cost of producing 120 units of Q is M and the average total cost is? O288; 2.4 244: 2.0 O288; 2.0 O 244:24
A firm uses inputs L and K to produce and good Q. The production function is Q-0.5LK. In the short-run, K is fixed at 20 units, the price of labor is PL $14 and the price of capital is PK - $6. The total cost of producing 120 units of Q is M and the average total cost is? O288; 2.4 244: 2.0 O288; 2.0 O 244:24
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Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter7: Proudction Costs
Section: Chapter Questions
Problem 2SQ
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Transcribed Image Text:A firm uses inputs L and K to produce and good Q. The production function is Q-0.5LK. In the
short-run, K is fixed at 20 units, the price of labor is PL = $14 and the price of capital is Pk = $6. The
total cost of producing 120 units of Qis and the average total cost is?
O 288; 2.4
O244: 2.0
O 288; 2.0
244:24
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