Refer to the Following

question 70

Multiple Choice

Refer to the following:
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.

-what output does the firm reach minimum average variable cost?

• A) 7,400
• B) 8,000 units
• C) 100 units
• D) 6,000
• E) 600

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Definitions:

Inventory

Goods or materials a business holds for the purpose of resale.

Order

A request to purchase, sell, or supply goods or services.

Total Variable Costs

The cumulative amount of variable expenses incurred in the production of goods or services.

Volume Of Activity

This term refers to the level of operations or the quantity of work done or services provided in a specific period.