Post Utme Unilorin 2018 Economics Question 7

Practice objective / multiple choice question 7 from the 2018 Post Utme Unilorin Economics examination.

Post Utme Unilorin 2018 Economics Objective / Multiple Choice

Question 7 POST_UTME_UNILORIN • 2018 • ECONOMICS • objective

A firm is producing a good with a production function Q = 2L^0.4K^0.6. If the price of labor increases by 20% and the price of capital remains cons\tant, what will be the effect on the firm's output?

Answer Options

A. The firm's output will increase by 10%.

Correct Answer B. The firm's output will decrease by 10%.

C. The firm's output will remain the same.

D. The effect on the firm's output is uncertain.

Correct Answer

Correct Option:

The firm's output will decrease by 10%.

About This Question

This is Post Utme Unilorin 2018 Economics Question 7. It is one of the objective questions from the 2018 Post Utme Unilorin Economics examination.

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