Question

If a labour output function for laundry service is described by the following equation: $O = (a^0 - 4L^0)^6$, where $L$ denotes Labour and $O$ denotes output. Then, output .........

• A. Increases as labor increases
• B. Decreases as labor increases
• C. Remains constant irrespective of the amount of labor
• D. None of the option is correct

Answer 1

The Correct Option is C

Given the labour output function for the laundry service:
$$O = (a^0 - 4L^0)^6$$
where $L$ denotes labour and $O$ denotes output.
1. $a^0$ is always equal to 1 for any non-zero $a$.
2. $L^0$ is always equal to 1 for any non-zero $L$.
Thus, the expression simplifies to:
$$O = (1 - 4 \cdot 1)^6$$
$$O = (1 - 4)^6$$
$$O = (-3)^6$$
$$O = 729$$
Therefore, the output $O$ remains constant at 729, regardless of the amount of labour $L$.
Correct answer is Option C : Remains constant irrespective of the amount of labor.