The Following Graph Shows the Marginal and Average Product Curves

question 31

Multiple Choice

The following graph shows the marginal and average product curves for labor,the firm's only variable input.The monthly wage for labor is $2,800.Fixed cost is $160,000. When the firm uses 40 units of labor,what is average total cost at this output?

• A)$140
• B)$40
• C)$70
• D)$170
• E)none of the above

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Definitions:

Taxation

A process by which governments finance their expenditure by imposing charges on citizens and corporate entities.

Regressive Tax

A tax imposed in such a manner that the tax rate decreases as the amount subject to taxation increases, disproportionately impacting those with lower incomes.

Tax Revenues

The money that governments procure from tax collection.

Local Governments

Administrative bodies in smaller geographical areas within a country that govern at a level below that of the state or federal government.