Asked by
Aaliyah Sambale
on Oct 14, 2024
Verified
the production function is given by f(x) 4x1/2.If the price of the commodity produced is $50 per unit and the cost of the input is $40 per unit, how much profit will the firm make if it maximize profits?
A) $235
B) $123
C) $250
D) $504
E) $128
Profit
The financial surplus remaining after all expenses have been deducted from total revenue, indicative of the financial success of a business operation.
Commodity
An essential commodity employed in business activities that is substitutable with other commodities of the identical category.
Maximise
The process of increasing a particular variable or outcome to its highest possible value under given constraints.
- Acquire an understanding of the dynamics between input costs, output prices, and the pursuit of maximum profits.
- Harness production functions to derive the optimal quantities of inputs for the maximization of earnings.
- Evaluate how changes in prices for inputs and outputs influence the optimal levels of inputs for profit maximization.
Verified Answer
GU
Learning Objectives
- Acquire an understanding of the dynamics between input costs, output prices, and the pursuit of maximum profits.
- Harness production functions to derive the optimal quantities of inputs for the maximization of earnings.
- Evaluate how changes in prices for inputs and outputs influence the optimal levels of inputs for profit maximization.