In: Economics
Suppose you are given the following data:
Assume the following figures (all labor is paid equally):
Quantity = 34 units produced for 3 workers hired
10 units produced for 2 workers hired
1 unit produced for 1 worker hired
0 units produced for 0 workers hired
Fixed Cost = $50
Variable Cost = $40 total for 1 worker hired
From this data, what is the average total cost when two workers are hired?
Average total cost =total cost/quantity
total cost =variable cost +fixed cost
variable cost=L*wage
=2*40
=$80
Fixed cost =$50
Total cost =80+50=$130
Q=10
Average total cost =130/10=$13
the average total cost when two workers are hired is $13