Suppose that a firm's only variable input is labor. When 50 workers are used, the average product

Question:

Suppose that a firm's only variable input is labor. When 50 workers are used, the average product of labor is 50, and the marginal product of the 50th worker is 75. The wage rate is $80, and the total cost of the fixed input is $500.

a. What is average variable cost? Show your calculations.

b. What is marginal cost? Show your calculations.

c. What is average total cost? Show your calculations.

d. Is each of the following statements true or false? Explain your answer.

1. Marginal cost is increasing.

2. Average variable cost is increasing.

3. Average total cost is decreasing.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Economics for Managers

ISBN: 978-0132773706

3rd edition

Authors: Paul G. Farnham

Question Posted: Dec 15, 2015 06:38 AM

See More Questions

Multiple Choice Questions: 1. The long run a. Is a period in which a firm can adjust all its inputs. b. Can vary in length from industry to industry. c. Is a period in which all costs are variable...
The Ajax Coal Company is the only employer in its area. Its only variable input is labor, which has a constant marginal product equal to 5. Because it is the only employer in the area, the firm faces...
Suppose that a firm's only variable input is labor, and the constant hourly wage rate is $20 per hour. The last unit of labor hired enabled the firm to increase its hourly production from 250 units...
On 1 May 2006, Nigel acquired a 30-year lease for 20,000. He assigned the lease on 1 November 2020 for 75,000. Kay purchased land in February 2012 for 20,000. She sold one-third of the land for...
Charity and Devon are planning to license technology from NASA that makes it impossible to accidentally lock a child in a car. The technology is complex and the market analysis and financial...
Haven received 200 NQOs (each option gives him the right to purchase 20 shares of Barlow Corporation stock for $7 per share) at the time he started working for Barlow Corporation three years ago when...
Use the probability distribution you made in Exercise 20 to find the probability of randomly selecting a resident of the locality who watches (a) two or three movies, (b) more than three movies, (c)...
Review the February 26 and March 25 transactions for Success Systems (SP 5) from Chapter 5. Required 1. Assume that Lyn Addie is an unmarried employee. Her $ 1,000 of wages are subject to no...
Examine the thermodynamic aspects of renewable energy technologies, including solar thermal systems, wind turbines, and fuel cells, in terms of energy conversion efficiency, exergy analysis, and the...
Brett Collins is reviewing his company's investment in a cement plant. The company paid $12,000,000 five years ago to acquire the plant. Now top management is considering an opportunity to sell it....
How would an improvement in technology that increased the marginal productivity of labor change the firm's cost curves?
In the fast-food industry case that opened this chapter, describe how diminishing returns set in for the production process and how management responded to this situation.
What are the three types of government organizations and where should each look for guidance in accounting?
"Goods bought for personal, family, or household use" are not covered under CISG. Discuss by giving traceable citations and case law if possible ?
Advise Cassie 4. "The rules relating to establishing a common intention constructive trust of the family home generate both uncertainty and unfairness." 1000 world article with example with case law
Burien Family Market has two family-owned grocery stores that have been in business for years. Whole Foods decides that Burien Family Market would be an excellent place to build one of its...
Was the sport attractive for the TV format, in your opinion? Why do you think it might not have lasted beyond that decade? https://youtu.be/mpithZbH5sI
discuss the trade-offs between various threading models, such as user-level threading (ULT), kernel-level threading (KLT), and hybrid threading, in terms of performance, resource utilization, and...
Fill in each blank so that the resulting statement is true. 10i - (-4i) =_______.
Accounting policies and practices that are most important to the portrayal of the companys financial condition and results, and require managements most difficult, subjective, or complex judgments...
Nationwide Bank has approached Hometown Bank with a proposal to merge. The following table lists the sales of the banks in the area. Use this information to calculate the four-firm concentration...
Suppose Fiat recently entered into an Agreement and Plan of Merger with Case for $4.3 billion. Prior to the merger, the market for four-wheel-drive tractors consisted of five firms. The market was...
Use the estimated elastic-cities in Table 7??4 to calculate the Rothschild index for each industry. Based on these calculations, which industry most closely resembles perfect competition? Which...
3. Show that : -3t = y 3 sin(t) cos(t) + e is a solution to the differential equation y' + 3 y 10 sin(t)
The United States, Austrailia, Canada, and the United Kingdom cluster high on individualism but low on power distance on Hofstede\'s cutlutral graph. What does this mean to someone looking to market...
Mini-garden project Week one of the mini-garden project involved Sacha and her fellow pre-schoolers planting sunflower seeds into the outdoor garden bed. Each child in the activity has been assigned...

Suppose that a firm's only variable input is labor. When 50 workers are used, the average product

Question:

Step by Step Answer:

L 50 APL 50 MPL 75 PL 80 TFC 500 a AP Q L 50 Q 50 Q 2500 AVC TVC Q 80 50 2500 4000 2...View the full answer

Economics for Managers

Students also viewed these Economics questions