Question

Suppose that the supply curve is given by P = 2Q. The elasticity of supplyis ____

Use the following information to answer questions10 and 11.Output for a simple production process is given by Q = KL, where K denotes capital, and L denotes labor. The price of labor is $10 per unit andthe price of capital is $2 per unit

10. If at the current level of production the marginal product of labor is 4 while the marginal product of capital is 2 then in order to minimize your costs of production you should use:

A.More capital and less labor

B.More labor and less capital

C.More of both inputs

D.The same amount of both inputs

11. Suppose at the current level of production the firm is minimizing costs and the marginal product of labor is 10. Given this you know that the marginal product of capital must be____.

Answer 1