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A Firm's Production Function Is Given By Q=KLQ = K L

Question 53

Multiple Choice

A firm's production function is given by Q=KLQ = K L . The marginal products of labor and capital are, respectively, MPL=KM P _ { L } = K and MPK=LM P _ { K } = L . The wage rate of labor is w=$10w = \$ 10 and the rental rate of capital is r=$20r = \$ 20 . The firm spends exactly $1000\$ 1000 in the most efficient way possible. How much output can the firm produce?


A) 450
B) 800
C) 1000
D) 1250

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