Suppose a firm uses workers and office space to produce output. The firm is locked into a year-long lease on its office space, but it can easily vary the number of employee-hours it uses each day. The accompanying table describes the relationship between the number of employee-hours the firm uses each day and the firm's daily output. Each unit of output sells for $2, the hourly wage rate is $14, and the rent on the office space is $50 per day.Employee-Hours Per DayOutput Per Day0014048091201516023200 What is the marginal cost of production between 80 and 120 units of output each day?
A. $70
B. $14
C. $1.75
D. $1.40
Answer: C
You might also like to view...
Suppose that the price of labor, the only variable input needed to produce cotton, increases from $100 day to $120 day. The effect on costs will be
a. a parallel shift in the total cost curve. b. a parallel shift in the fixed cost curve. c. a parallel shift in the marginal cost curve. d. a shift in total cost by different amounts for different quantities.
A study which observes whether a particular occurrence influences some outcome is referred to as a(n):
A. event study. B. exponential study. C. laboratory study. D. comparative study.
Total fixed costs:
A. are zero when no output is produced. B. are positive even when no output is produced. C. increase as output increases. D. decrease as output increases.
In the United States, one problem with central bank independence is:
A. it is almost impossible to obtain because Congress controls the budget of the Federal Reserve. B. central bank independence has not produced favorable results. C. in a representative democracy, monetary policymakers must be held accountable to the public. D. the central bank can control policy, but the U.S. Treasury issues currency.