Refer to the Following:
the Capital Stock Is Fixed at 5

question 34

Multiple Choice

Refer to the following:
The capital stock is fixed at 5 units, the price of capital is $60 per unit, and the price of labor is $20 per unit.

$$\begin{array} { c c } \text { units of } & \text { units of } \\\text { Labor } & \text { Output } \\\hline 2 & 10 \\4 & 26 \\0 & 46 \\8 & 60 \\10 & 72 \\12 & 80\end{array}$$
-How much does the 12th unit of output add to the firm's total variable cost?

• A) $2.50
• B) $4
• C) $5
• D) $20
• E) $40

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