Neco Model Questions Vol1 2023 Economics Question 22

Practice objective / multiple choice question 22 from the 2023 Neco Model Questions Vol1 Economics examination.

Neco Model Questions Vol1 2023 Economics Objective / Multiple Choice Hard Difficulty
Question 22 NECO_MODEL_QUESTIONS_VOL1 • 2023 • ECONOMICS • objective

A firm produces output according to the production function \(Q = 2L^{0.5}K^{0.5}\), where \(L\) is labour units and \(K\) is capital units. The wage rate is ₦200 per unit of labour and the rental rate of capital is ₦500 per unit of capital. To produce 800 units of output, determine the cost‑minimising quantities of labour and capital and compute the minimum total cost.

Answer Options

A. Labour ≈ 650.00 units, Capital ≈ 250.00 units, Minimum total cost ≈ 255,000 Naira
B. Labour ≈ 700.00 units, Capital ≈ 200.00 units, Minimum total cost ≈ 250,000 Naira
C. Labour ≈ 600.00 units, Capital ≈ 300.00 units, Minimum total cost ≈ 260,000 Naira
Correct Answer D. Labour ≈ 632.46 units, Capital ≈ 252.98 units, Minimum total cost ≈ 252,982 Naira
Correct Answer
D
Correct Option:
Labour ≈ 632.46 units, Capital ≈ 252.98 units, Minimum total cost ≈ 252,982 Naira

About This Question

This is Neco Model Questions Vol1 2023 Economics Question 22. It is one of the objective questions from the 2023 Neco Model Questions Vol1 Economics examination.

Difficulty level: Hard .

View More Neco Model Questions Vol1 2023 Economics Questions More Neco Model Questions Vol1 Practice Questions Back to Questions

Master the Exam!

You've seen a preview, but there are thousands more questions plus AI tutor to break down complex solutions.

Unlock Full Access Available for Android & Windows
Chat with Support