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A Firm's Production Function Is Given By Q=K2LQ = K ^ { 2 } L

Question 72

Multiple Choice

A firm's production function is given by Q=K2LQ = K ^ { 2 } L . The marginal products of labor and capital are, respectively, MPL=K2M P _ { L } = K ^ { 2 } and MPK=2KLM P _ { K } = 2 K L . Further, the wage rate is w=$10w = \$ 10 and the rental rate of capital is r=$20r = \$ 20 . Suppose the firm wants to produce 27,000 units of output. What is the most efficient combination of labor and capital (L,K) ( L , K ) ?


A) (20,20) ( 20,20 )
B) (30,30) ( 30,30 )
C) (30,90) ( 30,90 )
D) (90,30) ( 90,30 )

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