Suppose That the Firm's Only Variable Input Is Labor

question 7

Multiple Choice

Suppose that the firm's only variable input is labor.When 50 workers are used,the average product of labor is 50 and the marginal product of labor is 75.The wage rate is $80 and the total cost of the fixed input is $500.What is average variable cost?

• A)$0.63
• B)$1.60
• C)$3.20
• D)$10.00
• E)none of the above

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Definitions:

Confidence Interval

A statistical measure that provides an estimated range of values likely to include a population parameter, calculated from a given set of sample data.

Population Mean

The population mean is the average value of all data points in a full set of values, representing the central tendency of the population.

Precision Control

The ability to maintain a very high level of accuracy and consistency in a process or measurement.

Confidence Interval

A scale of values, originating from sample statistical analysis, projected to house the value of an undetermined population parameter.