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Relation between average product and average variable cost

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Reference no: EM1392421

For the table given

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?

Total 





__________________________
Units of 
Average Marginal



labor  Output  Product Product Fixed Variable Total 








10






20     4,000





40   10,000





60   15,000





80   19,400





100   23,000






Average



_______________________________
Units of 



Marginal 
labor  Output  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

Reference no: EM1392421

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