Suppose That a Firm Has Only One Variable Input, Labor

question 625

Multiple Choice

Suppose that a firm has only one variable input, labor, and firm output is zero when labor is zero. When the firm hires 6 workers the firm produces 90 units of output. Fixed costs of production are $6 and the variable cost per unit of labor is $10. The marginal product of the seventh unit of labor is 4. Given this information, what is the marginal cost of production when the firm hires the 7th worker?

• A)$1.50
• B)$2.50
• C)$5
• D)$10

---

Definitions:

Bipedalism

The ability to walk upright on two legs, characteristic of humans and their ancestors.

Ultraviolet Sun Radiation

A type of electromagnetic radiation emitted by the sun that has shorter wavelengths than visible light, can cause skin damage, and is instrumental in the production of vitamin D in the skin.

Free Hands

The freedom or capacity to act or operate without constraint or interference.

Visual Acuity

The clarity of vision or the sharpness of eyesight, measured as the ability to discern letters or numbers at a standardized distance.