Relationship between the average variable cost and marginal

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Reference no: EM13872330

Technical Problem

Units of Average Marginal Marginal

labor Output Product Product Fixed Variable Total Fixed Cost Variable Cost Total Cost Cost

10
20 4,000
40 10,000
60 15,000
80 19,400
100 23,000

Fixed costs are 5 units @ $2,000 per unit

Variable costs are $500 per unit

Just fill out the table, don't do parts b & c

For the spreadsheet above:

The first two columns in the table give a firm's short-run production function when the only variable input is labor, and capital (fixed input) is held constant at 5 units. The price of captial is $2,000 per unit, and the price of labor is $500 per unit.

a. Complete the table

b. What is the relationship between the average variable cost and marginal cost? Between the averae total cost and marginal cost?

c. What is the relation between average product and average variable cost? Between marginal product and marginal cost?

Reference no: EM13872330

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