Consider the Production Problem: Find the Shadow Price for Resource

Multiple Choice

Consider the production problem: Find the shadow price for resource 2. Identify the binding and nonbinding constraints.

A) The shadow price for resource 2 is $60 .Constraints 1, 2 and 3 are binding constraints.
B) The shadow price for resource 2 is $0.1 .Constraints 1 and 2 are binding constraints and constraint 3 is nonbinding.
C) The shadow price for resource 2 is $60 .Constraints 1 and 3 are nonbinding constraints and constraint 2 is binding.
D) The shadow price for resource 2 is $0.1 .Constraint 1 is binding constraint and constraints 2 and 3 are nonbinding.