The following graph shows the marginal and average product curves for labor, the firm's only variable input. The monthly wage for labor is $2,800. Fixed cost is $160,000.
At what output does the firm reach minimum average variable cost?
A. 8,000
B. 6,000
C. 100
D. 7,400
E. 600
Answer: A
You might also like to view...
The use of a central planning board or commission to answer the fundamental economic questions is typical of what kind of economy?
a. traditional b. supply c. command d. market
The least-cost way of producing a particular rate of output is represented by a point of tangency between a short-run average cost curve and the
a. total cost curve b. short-run average total cost curve c. average variable cost curve d. long-run average cost curve e. marginal cost curve
A policy to do nothing and allow the economy to self-correct or adjust without interference from the federal government is also called a(n) _______________ policy:
a. nonintervention b. active c. stabilization d. fixed rule
Dumping goods is profitable whenever:
a. the firm does not get caught. b. the firm can hire illegal workers to process the production. c. the foreign market price (after transportation costs) is higher than marginal cost but lower than the home price. d. the foreign firm eventually closes because it cannot compete.