Suppose That Capital Costs $100 Per Unit and Labour Costs

Multiple Choice

Suppose that capital costs $100 per unit and labour costs $40 per unit.If the marginal product of capital is 200 and the marginal product of labour is 60,a cost- minimizing firm should

A) employ more of both capital and labour.
B) employ less of both capital and labour.
C) not change its current factor use.
D) employ less capital and more labour.
E) employ more capital and less labour.