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      Question

      Consider the following production function Q =

      20L – 0.2L2 – 20K + 0.2 K2 + 4KL If 20 units of capital is used , what is the upper limit of labor that a rational producer will use?
      A 100 Correct Answer Incorrect Answer
      B 150 Correct Answer Incorrect Answer
      C 200 Correct Answer Incorrect Answer
      D 250 Correct Answer Incorrect Answer

      Solution

      Producer will use labour upto the point where MPL is greater or equal to 0. So, MPL 0

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