Solved

The Production Function Is F(x1, X2) = 1

Question 19

Multiple Choice

The production function is f(x1, x2) = The production function is f(x<sub>1</sub>, x<sub>2</sub>) = <sub>1</sub> <sub> </sub> <sub>2</sub>. If the price of factor 1 is $6 and the price of factor 2 is $12, in what proportions should the firm use factors 1 and 2 if it wants to maximize profits? A) x<sub>1</sub> = 12x<sub>2</sub>. B) x<sub>1</sub> = 0.50x<sub>2</sub>. C) x<sub>1</sub> = 2x<sub>2</sub>. D) x<sub>1</sub> = x<sub>2</sub>. E) We can't tell without knowing the price of the output. 1
The production function is f(x<sub>1</sub>, x<sub>2</sub>) = <sub>1</sub> <sub> </sub> <sub>2</sub>. If the price of factor 1 is $6 and the price of factor 2 is $12, in what proportions should the firm use factors 1 and 2 if it wants to maximize profits? A) x<sub>1</sub> = 12x<sub>2</sub>. B) x<sub>1</sub> = 0.50x<sub>2</sub>. C) x<sub>1</sub> = 2x<sub>2</sub>. D) x<sub>1</sub> = x<sub>2</sub>. E) We can't tell without knowing the price of the output. 2. If the price of factor 1 is $6 and the price of factor 2 is $12, in what proportions should the firm use factors 1 and 2 if it wants to maximize profits?


A) x1 = 12x2.
B) x1 = 0.50x2.
C) x1 = 2x2.
D) x1 = x2.
E) We can't tell without knowing the price of the output.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q12: If the value of the marginal product

Q14: A competitive firm produces a single output

Q16: When Farmer Hoglund applies N pounds of

Q17: Jiffy-Pol Consultants is paid $1,000,000 for each

Q18: A competitive firm's production function is f(x<sub>1</sub>,

Q20: A profit-maximizing competitive firm uses just one

Q21: The production function is f(x<sub>1</sub>, x<sub>2</sub>) =

Q22: Philip owns and operates a gas station.

Q38: If there is perfect certainty, a competitive

Q41: If a profit-maximizing competitive firm has constant