10.the olowing graph shows the marginal and average product curves for labor,the firm's only variable input. The monthly wage for labor is $2,000. Fixed cost is$120,000.+ APMP1008060MPAP2040608010012014010LaborWhat is AVC at its minimum?Multiple ChoiceO $80when AP is maximzedO $15. O$25.O$40120000. O$1002,000Ave rage ard m arginal prodictof labor

When L = 100, TVC = w x L = 2,000 x 100 = 200,000 Minimum AVC = TVC / Q = 200,000 / 8,000 = $25

Answered: 10. The following graph shows the…

10. The following graph shows the marginal and average product curves for labor, the firm's only variable input. The monthly wage for labor is $2,000. Fixed cost is $120,000.

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter7: Production And Cost In The Firm

Section: Chapter Questions

Problem 3.7P

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Question

10.
the olowing graph shows the marginal and average product curves for labor,
the firm's only variable input. The monthly wage for labor is $2,000. Fixed cost is
$120,000.
+ APMP
100
80
60
MP
AP
20
40
60
80
100
120
140
10
Labor
What is AVC at its minimum?
Multiple Choice
O $80
when AP is maximzed
O $15
. O$25
.O$40
120000
. O$100
2,000
Ave rage ard m arginal prodictof labor

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