In the Following Graph,the Price of Capital Is $100 Per

question 76

Multiple Choice

In the following graph,the price of capital is $100 per unit; the price of labor is $25 per unit.When output is 20 units,what is AVERAGE cost?

• A)$350
• B)$700
• C)$3,500
• D)$7,000
• E)none of the above

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Definitions:

Marginal Product

The additional output resulting from one more unit of a certain input, holding all other inputs constant.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a resource, such as labor or capital.

Demand for Automobiles

Refers to consumers' desire and willingness to purchase vehicles, influenced by factors such as prices, incomes, and personal preferences.

Substitute Inputs

Inputs or resources that can be used in place of one another in the production process without significantly affecting the output.