Sue’s Surfboards rents a factory building. If the rent is increased by $200 a week and other things remain the same, how do Sue’s Surfboards’ short-run average cost curves and marginal cost curve change?
Sue’s Surfboards, in Problem 3, hires workers at $500 a week and its total fixed cost is $1,000 a week.
In problem 3
Labor Output
(workers (surfboards
per week) per week)
1 …………………….. 30
2 …………………….. 70
3 …………………….. 120
4 …………………….. 160
5 …………………….. 190
6 …………………….. 210
7 …………………….. 220