Calculate the current average cost of producing each unit

Reference no: EM13203915

A firm has this linear production function: Q = 5K + 2L. Each unit of labor costs $10 to employ and each unit of capital cost $8 to employ.
The firm is currently employing 100 units of labor and 200 units of capital.

a. Calculate the total number of units of output that the firm is currently producing
b. Calculate the current total cost of production for the firm. (Labor and capital are this firm's only costs.)
c. Calculate the current average cost of producing each unit of output.

Reference no: EM13203915

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