Chapter 22: Q.20 (page 509)
If the firm were to employ an 8th unit of labour, its total product would rise to 380 units of output. What would be the resulting values of the average product of labour and of the marginal product of labour?
The average product of labour isand the marginal product of labour is
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In an effort to reduce their total costs, many companies are now replacing paychecks with payroll cards, which are stored-value cards onto which the companies can download employees' wages and salaries electronically. If the only factor of production that a company varies in the short run is the number of hours worked by people already on its payroll, would shifting from paychecks to payroll cards reduce the firm's total fixed costs or its total variable costs? Explain your answer.
As ports have produced higher quantities of loading and unloading services, have there been upward movements along their AVC and MC curves or upward shifts in those curves? Explain.
During autumn months, passenger railroads across the globe deal with a condition called slippery rail. It results from a combination of water, leaf oil, and pressure from the train's weight, which creates a slippery black ooze that prevents trains from gaining traction.
a. One solution for slippery rail is to cut back trees from all of a rail firm's rail network on a regular basis, thereby helping to prevent the problem from developing. If incurred, would this railroad expense be a better example of a fixed cost or a variable cost? Why?
b. Another way of addressing slippery rail is to wait until it begins to develop. Then the company purchases sand and dumps it on the slippery tracks so that trains already enroute within the rail network can proceed. If incurred, would this railroad expense be a better example of a fixed cost or a variable cost? Why?
Just before the firm discussed in Problem produced its last tablet device in the previous month, its total costs were , What was the marginal cost incurred by the firm in producing the final tablet device that month?
In Problem 22-20, if the firm were to employ the 8th unit of labour and produce 380 units of output, what would be the average variable cost and the marginal cost?
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