The figure below shows the isocost lines facing a firm producing golf tees.
FIGURE 8-5
-Refer to Figure 8-5. The firm that is facing the isocost lines as shown will minimize its cost of production of any given output level if it employs capital and labour such that the ratio of the marginal product of labour to the marginal product of capital MPL/MPK) is equal to
A) 5/2.
B) 5.
C) 2.
D) 2/5.
E) Not able to determine from the information provided.

Question

The figure below shows the isocost lines facing a firm producing golf tees.
  FIGURE 8-5
-Refer to Figure 8-5. The firm that is facing the isocost lines as shown will minimize its cost of production of any given output level if it employs capital and labour such that the ratio of the marginal product of labour to the marginal product of capital MPL/MPK) is equal to
A) 5/2. 
B) 5. 
C) 2. 
D) 2/5. 
E) Not able to determine from the information provided.

Quizplus · Accepted Answer

The Answer of The figure below shows the isocost lines facing a firm producing golf tees.
  FIGURE 8-5
-Refer to Figure 8-5. The firm that is facing the isocost lines as shown will minimize its cost of production of any given output level if it employs capital and labour such that the ratio of the marginal product of labour to the marginal product of capital MPL/MPK) is equal to
A) 5/2. 
B) 5. 
C) 2. 
D) 2/5. 
E) Not able to determine from the information provided.

The Figure Below Shows the Isocost Lines Facing a Firm