The Table Below Describes the Relationship Between the Number of Workers

question 140

Multiple Choice

The table below describes the relationship between the number of workers hired by a call center each hour and the number of calls the call center can make each hour. The call center has only 1 telephone. The telephone costs the firm $5/hour (regardless of how many calls are made) , and each worker is paid $10 per hour. $$\begin{array} { | c | c | c | } \hline \begin{array} { c } \text { Calls Per } \\\text { Hour }\end{array} & \begin{array} { c } \text { Number of } \\\text { Telephones } \\\text { Per Hour }\end{array} & \begin{array} { c } \text { Number of } \\\text { Workers } \\\text { Per Hour }\end{array} \\\hline 1 & 1 & 2 \\\hline 2 & 1 & 4 \\\hline 6 & 1 & 6 \\\hline 16 & 1 & 8 \\\hline 22 & 1 & 10 \\\hline 24 & 1 & 12 \\\hline\end{array}$$ Average variable cost is minimized when output is approximately:

• A)6 units.
• B)16 units.
• C)22 units.
• D)24 units.

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Definitions:

Elasticity of Supply

A measure of how much the quantity supplied of a good responds to a change in the price of that good, indicating the flexibility of producers.

Deadweight Loss

An economic inefficiency resulting from the lack of or impossibility to attain equilibrium in the market for a particular good or service.

Tax Revenue

The income generated by the government through the imposition of taxes on goods, services, and income.

Supply and Demand

Supply and demand is a fundamental economic model describing how prices and quantities of goods and services are determined in a market.