The wage rate is $20 per hour and the cost of capital is $30 per hour. At the current output, the firm's MPL is 6 units and MPK is 8 units. In order to maximize profit without changing the production level, the firm should
The wage rate is $20 per hour and the cost of capital is $30 per hour. At the current output, the firm's MPL is 6 units and MPK is 8 units. In order to maximize profit without changing the production level, the firm should
Chapter7: Production And Cost In The Firm
Section: Chapter Questions
Problem 3.8P
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![The wage rate is $20 per hour and the cost of capital is $30 per hour. At the current output, the firm's MPL is 6
units and MPK is 8 units. In order to maximize profit without changing the production level, the firm should
Select one:
OA.
keep its current level of labour and capital inputs.
В.
rent more capital and hire less labour
c.
hire less labour and rent less capital
O D.
rent less capital and hire more labour](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F6150f978-c808-45bd-bc2c-c438145156cc%2F97383132-babc-4b51-860f-b18c54aa12e4%2Fh9idkgc_processed.jpeg&w=3840&q=75)
Transcribed Image Text:The wage rate is $20 per hour and the cost of capital is $30 per hour. At the current output, the firm's MPL is 6
units and MPK is 8 units. In order to maximize profit without changing the production level, the firm should
Select one:
OA.
keep its current level of labour and capital inputs.
В.
rent more capital and hire less labour
c.
hire less labour and rent less capital
O D.
rent less capital and hire more labour
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