Quiz-3.1, 3.2, 3.3 Calculations C
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Last updated 9 months ago
10 Nsɛmmisa
The Purple Hat Company makes amazing hats! They are in the short-run and use both labor and capital. Labor is variable and capital is fixed. Their capital cost is $15 and each worker gets paid a wage of $8. Their input and output is listed below.
Qinput | Qoutput |
0 | 0 |
1 | 5 |
2 | 15 |
3 | 30 |
For all answers, please include units!
At 0 worker, what is the firm's total product?
Assume the firm is NOW in the long-run as seen in table below. Assume ALL positions on the table are reflective of the long-run. Assume the wage is still $8 and the cost per unit of capital is $15.
Output | K=1 | K=2 | K=3 |
L=1 | 5 | 10 | 24 |
L=2 | 15 | 25 | 40 |
L=3 | 30 | 30 | 45 |
At 3 workers, what is the firm's total cost?
On which worker(s) does the firm have increasing marginal returns?
What is the average total cost of 5 units of output?
What is the marginal product at 1 unit of labor?
What is the average fixed cost with 15 units of output?
What is the marginal cost at 25 units of output?
At which output level(s) does the firm experiencing negative marginal returns?
Which combination of resources would be at the bottom of the LR-ATC curve?