Suppose That the Firm's Only Variable Input Is Labor

question 102

Multiple Choice

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

• A)Average variable cost is increasing.
• B)Marginal cost is increasing.
• C)Average variable cost is decreasing.
• D)Cannot determine without more information.

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Definitions:

Product Assembly Team

A group of individuals who work collaboratively to build and assemble the physical parts of a product.

Autonomous Work Team

A group of employees who are given the authority to manage themselves and make decisions related to their tasks, often within a certain framework or guideline set by the organization.

Employee Involvement Team

A group of employees formed to participate in organizational decision-making processes, aimed at improving work conditions, productivity, and employee satisfaction.

Expert Team

A group of individuals with specialized knowledge or skills in a particular area, working together to achieve specific goals.