Inputs Required to Produce a Product Using Alternative Technologies Technology Units of Capital Number of Employees A 16 8 B 12 12 C 8 20 D 6 24 If the hourly price of capital is $30 and the hourly wage rate is $5, which production technology should be selected? A B C D
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To do this, we multiply the number of units of capital by the hourly price of capital and add it to the number of employees multiplied by the hourly wage rate. For Technology A: Total cost = (16 units of capital * $30/hour) + (12 employees * $5/hour) = $480 + $60 Show more…
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