Cindy's Sweaters' production function is shown in the above table. Cindy rents two knitting machines for $30 a day each and hires workers at a wage rate of $40 a day
If Cindy produces 20 sweaters per day, what is her average fixed cost of production? A) $3.00
B) $3.33
C) $8.00
D) $11.00
A
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If a nation is currently operating at a point inside its production possibilities curve, it
A. can increase the output of one good without decreasing the output of the other good. B. has fully employed resources. C. has no inefficiently employed resources. D. is operating at full potential.
A producer is said to have an absolute advantage in the production of a good when:
A) the producer can produce more units of the good per hour than another producer. B) the producer has a lower opportunity cost than another producer. C) the producer has a higher opportunity cost than another producer. D) the producer can sell the good at a higher price than another producer.
A rightward shift of the production possibilities frontier of an economy represents: (check all that apply)
a. an increase in the average price level in the economy. b. economic growth. c. an increase in the quantity of resources. d. an increase in the overall demand for goods and services in the economy.
If the government tightens up on drug dealers and raises the costs of dealing illegal drugs, then the drug addicts' dollar expenditures to feed their addiction will tend to:
A. Increase because their demand is price-elastic B. Decrease because their demand is price-Inelastic C. Decrease because their demand is price-elastic D. Increase because their demand is price-Inelastic