Suppose the long-run cost function is C = 2q2. What is the cost-output elasticity for this case?
A) 1
B) 2
C) 1/2
D) 4

Name: Suppose the long-run cost function is C = 2q2. What is the cost-output elasticity for this case? A) 1 B) 2 C) 1/2 D) 4
Brand: Quizplus
Rating: 4.9 (33 reviews)

Question

Quizplus · Accepted Answer

The cost-output elasticity is calculated as (dC/dq) * (q/C). For C = 2q^2, dC/dq = 4q. Thus, the elasticity is (4q) * (q/(2q^2)) = 2.

Suppose the Long-Run Cost Function Is C = 2q2