If the value of the marginal product of physical capital is 20 ...

[eruditmonkey@yahoo.com]

If the value of the marginal product of physical capital is 20 and the value of the marginal product of labor is 5, the highest price that a firm should pay for an additional unit of physical capital is:
 
  A) 4.
  B) 5.
  C) 20.
  D) 100.

Question 2

Using the figure above, suppose a subsidy of 15,000 per student is provided to private colleges. Then, the market equilibrium occurs at a tuition of ________ a year and ________ million students.
 
  A) 10,000; 15
  B) 25,000; 15
  C) 15,000; 15
  D) 15,000; 7.5
  E) 20,000; 20

[Animal_Goddess]

Answer to Question 1

C

Answer to Question 2

A

[eruditmonkey@yahoo.com]

Gracias!

[olderstudent]

Excellent