A competitive firm produces a single output using several inputs. The price of o

Question

A competitive firm produces a single output using several inputs. The price of output rises by $2 per unit. The price of one of the inputs increases by $5 and the quantity of this input that the firm uses increases by 6 units. The prices of all other inputs stay unchanged. From the weak axiom of prot maximization we can tell that:

(a) the output of the good must have increased by at least 15 units.

(b) the inputs of the other factors must have stayed constant.

(c )the output of the good must have decreased by at least 7.50 units.

(d) the inputs of at least one of the other factors must have decreased by at least 6 units.

(e) the inputs of at least one of the other factors must have increased by at least 6 units.

Correct answer is A. Please explain how it's calculated.

Explanation / Answer

x *2 = 6*5

x= 15

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