Waec Model Questions Vol1 2020 Economics Question 27

Practice objective / multiple choice question 27 from the 2020 Waec Model Questions Vol1 Economics examination.

Waec Model Questions Vol1 2020 Economics Objective / Multiple Choice Hard Difficulty
Question 27 WAEC_MODEL_QUESTIONS_VOL1 • 2020 • ECONOMICS • objective

A manufacturing firm uses labour (L) and capital (K) to produce output according to Q = 20 L^{0.5} K^{0.5}. The wage rate is N150 per labour‑hour and the rental rate of capital is N200 per unit. The firm wishes to produce 1,000 units of output and sell each unit at N500. Determine the cost‑minimising quantities of labour and capital, the total cost of producing 1,000 units, and the resulting profit.

Answer Options

A. Labour ≈ 50 hrs, Capital ≈ 50 units; Total cost ≈ N20,000; Profit ≈ N480,000
B. Labour ≈ 65 hrs, Capital ≈ 35 units; Total cost ≈ N16,500; Profit ≈ N484,500
Correct Answer C. Labour ≈ 58 hrs, Capital ≈ 43 units; Total cost ≈ N17,320; Profit ≈ N482,680
D. Labour ≈ 45 hrs, Capital ≈ 55 units; Total cost ≈ N18,250; Profit ≈ N481,750
Correct Answer
C
Correct Option:
Labour ≈ 58 hrs, Capital ≈ 43 units; Total cost ≈ N17,320; Profit ≈ N482,680

About This Question

This is Waec Model Questions Vol1 2020 Economics Question 27. It is one of the objective questions from the 2020 Waec Model Questions Vol1 Economics examination.

Difficulty level: Hard .

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