Scott Owns a Law-Enforcement Training Operation in Collingwood

question 36

Multiple Choice

Scott owns a law-enforcement training operation in Collingwood. He employs three trainers. The last trainer Scott hired increased Scott's total cost by $466 per week even though the trainer brought in only one new client. Hence Scott's

• A) total variable cost equals $466.
• B) marginal cost of the last client equals $466.
• C) marginal cost of the last worker equals $233.
• D) total fixed cost of the last client equals $466.
• E) total variable cost equals $233.

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Definitions:

Total Revenue

The total income received by a firm from selling its products; calculated by multiplying the price per unit by the number of units sold.

Market Price

The current price at which an asset or service can be bought or sold in a particular market, determined by the supply and demand for it.

Average Revenue

The average amount of money received per unit of product or service sold, calculated by dividing total revenue by the number of units sold.

Marginal Revenue

The additional revenue that a firm receives from selling one more unit of a product or service.