The firm's profit maximization problem is:
A) max $\angle$ = F(r, w) - rK - wL
{r, w}
B) max $\angle$ = rK + wL - F(K, L)
{K, L}
C) max $\angle$ = F(K, L) - rK - wL
{r, w}
D) max $\angle$ = F(K, L) - rK - wL
{K, L}
E) All of these answers are correct.

Question

Quizplus · Accepted Answer

The profit maximization problem is to maximize the firm's profit, which can be expressed as total revenue minus total costs. In this case, the production function is F(K, L) and the cost function is rK + wL, where r is the rental rate for capital and w is the wage rate for labor. Therefore, the correct choice is D. A, B, and C have either the wrong production function or the wrong cost function. E is not the best choice because it includes incorrect options.

The Firm's Profit Maximization Problem Is: A) Max ∠\angle∠ = F(r, W) - RK - WL {R, W} B)

The Firm's Profit Maximization Problem Is:
A) Max $\angle$ = F(r, W) - RK - WL
{R, W}
B)