Waec Model Questions Vol1 2022 Economics Question 20
Practice objective / multiple choice question 20 from the 2022 Waec Model Questions Vol1 Economics examination.
A manufacturing firm produces output according to the Cobb‑Douglas function Q = 4 L^{0.6} K^{0.4}. The price of labour is ₦2,000 per unit and the price of capital is ₦5,000 per unit. The firm sells its output at a constant price of ₦20,000 per unit. (a) With L = 8 units and K = 27 units, calculate the marginal product of labour (MPL). (b) Should the firm increase, decrease, or keep the labour input unchanged to maximise profit, assuming capital remains at 27 units? Justify using the condition MPL × price of output compared with the wage.
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About This Question
This is Waec Model Questions Vol1 2022 Economics Question 20. It is one of the objective questions from the 2022 Waec Model Questions Vol1 Economics examination.
Difficulty level: Hard .
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