Refer to the information provided in Table 8.1 below to answer the question(s) that follow.
Table 8.1
Refer to Table 8.1. Assume the price of labor (L) is $5 per unit, the price of capital (K) is $10 per unit, and that firms attempt to minimize costs. The total variable cost of producing one unit of output is
A. $16.
B. $100.
C. $120.
D. $220.
Answer: B
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a. a substitute for; raise b. a complement to; raise c. a complement to; lower d. a complement to; substitute.
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