Suppose That for a Particular Firm the Only Variable Input

question 228

Multiple Choice

Suppose that for a particular firm the only variable input into the production process is labor and that output equals zero when no workers are hired. In addition, suppose that the average total cost when 5 units of output are produced is $80, and the marginal cost of the sixth unit of output is $160. What is the average total cost when six units are produced?

• A)$80.00
• B)$83.33
• C)$88.33
• D)$93.33

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Definitions:

Friend

A person with whom one has a bond of mutual affection and trust, typically exclusive of sexual or family relations.

Family Decisions

involve collective choices made by family members regarding aspects such as education, health care, financial management, and daily living activities.

Permissive/indulgent

A parenting style characterized by high levels of warmth and low levels of discipline, where parents are more likely to allow their children considerable freedom inside and outside of the house.

Owner Parents

The legal guardians or caretakers of a child, implying responsibility and authority over the child's upbringing and welfare.