Which method is economically efficient if: (i) The wage rate is $1 an hour and the rental cost of a machine is $100 an hour? (ii) The wage rate is $5 an hour and the rental cost of a machine is $50 an hour? (iii) The wage rate is $50 an hour and the rental cost of a machine is $5 an hour?

Which method is economically efficient if: (i) The wage rate is $1 an hour and the rental cost of a machine is $100 an hour? (ii) The wage rate is $5 an hour and the rental cost of a machine is $50 an hour? (iii) The wage rate is $50 an hour and the rental cost of a machine is $5 an hour?

Survey Of Economics

10th Edition

ISBN:9781337111522

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter6: Proudction Costs

Section: Chapter Questions

Problem 9SQP

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Question

Method	Labor (hours)	Capital (machines)
A	10	50
B	20	40
C	50	20
D	100	10

Which method is economically efficient if:

(i) The wage rate is $1 an hour and the rental cost of a

machine is $100 an hour?

(ii) The wage rate is $5 an hour and the rental cost of a

machine is $50 an hour?

(iii) The wage rate is $50 an hour and the rental cost of a machine is $5 an hour?

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