Neco 2017 Economics Question 9
Practice objective / multiple choice question 9 from the 2017 Neco Economics examination.
A firm's production function is \(Q = 10 L^{0.5} K^{0.5}\). The wage rate is \(w = 20\) Naira per unit of labour and the rental rate of capital is \(r = 30\) Naira per unit of capital. The firm has a total budget of \(1{,}200\) Naira for labour and capital. Determine the quantities of labour \(L\) and capital \(K\) that maximise output subject to the budget, and compute the maximum output. Give the maximum output to the nearest whole unit.
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About This Question
This is Neco 2017 Economics Question 9. It is one of the objective questions from the 2017 Neco Economics examination.
Difficulty level: Medium .
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