If output Q = 8.5e (e = units of effort)and Wage,W = $6.70 + 0.25Q,then 20 units of effort are worth ______ to the firm.
A)$170.00
B)$0.425
C)$49.20
D)$35.80

Question

Quizplus · Accepted Answer

When 20 units of effort are put into the production process, output Q would be:
Q = 8.5e = 8.5(20) = 170
Then, using the given formula for wage:
W = $6.70 + 0.25Q = $6.70 + 0.25(170) = $49.20
Therefore, 20 units of effort are worth $49.20 to the firm. So, the best choice is (C).

If Output Q = 8