Answer to Question #217555 in Microeconomics for EMY

Question

Consider a firm that has just built a plant, which cost $1,000. Each worker costs $5.00 per hour. Based on this information, fill in the table below. (7 marks) Weeks Sanitizer sales 1 5600 2 5200 3 4570 4 4305 5 5465 6 8900 7 15680 8 24680 9 35040 10 36500 11 38575 12 35300 13 35200 14 35150 15 34950 16 345005 Number of Worker Hours Output Marginal Product Fixed Cost Variable Cost Total Cost Marginal Cost Average Variable Cost Average Total Cost 0 0 -- -- -- 50 400 100 900 150 1300 200 1600 250 1800 300 1900 350 1950

Answer 1

Solution

marginal cost is calculated by getting a change in total product and dividing it by 50 numbers of workers.

Variable cost = number of workers hour multiplied by each worker cost $5.00.

Total fixed cost is given $1000 which is the cost of plant establishment.

Total cost is the summation of total fixed cost and total variable cost.

Average total cost = $\frac{total cost }{ output}$

average variable cost = $\frac{total variable cost }{output}$

Marginal cost is calculated by getting change and dividing by 50 which is $5.