Log in
Economics
3
answers
5
watching
4,017
views

A firm uses two inputs in production: capital and labor. In the short run, the firm cannot adjust the amount of capital it is using, but it can adjust the size of its workforce. What happens to the firm's average total cost curve, the average variable cost curve, and marginal cost curve when


a. the cost of renting capital increases?


b. the cost of hiring labor increases?

Watch
3
answers
5
watching
4,017
views

For unlimited access to Homework Help, a Homework+ subscription is required.

Anne Gillian Duero
Anne Gillian DueroLv10
28 Sep 2019

Unlock all answers

Get 1 free homework help answer.
Already have an account? Log in
Share
Already have an account? Log in
Share
Already have an account? Log in
Share

Related textbook solutions

Principles of Economics
2nd Edition, 2017
Openstax
ISBN: 9781947172364
Principles of Macroeconomics
2 Edition,
Openstax
ISBN: 9781947172388
Principles of Microeconomics
2 Edition,
Openstax
ISBN: 9781947172340

Related questions

A firm uses two inputs in production: capital and labor. In the short run, the firm cannot adjust the amount of capital it is using, but it can adjust the size of its workforce. What happens to the firm’s average total cost curve, the average variable cost curve, and the marginal cost curve when 
a. the cost of renting capital increases?
b. the cost of hiring labor increases?

A basic assumption of the short run is that a firm

A. cannot adjust its workforce or the amount of capital it uses
B. can reduce the number of workers it uses, but it cannot adjust how much capital it uses.
C. can freely adjust the amount of labor and capital that it employs.
D. can employ more workers and add more capital to the production process

  1. For a purely competitive firm total revenue:
  1. is price times quantity sold.
  2. increases by a constant absolute amount as output expands.
  3. graphs as a straight upsloping line from the origin.
  4. has all of these characteristics.

Answer:

  1. In the short run the individual competitive firm's supply curve is that segment of the:
  1. average variable cost curve lying below the marginal cost curve.
  2. marginal cost curve lying above the average variable cost curve.
  3. marginal revenue curve lying below the demand curve.
  4. marginal cost curve lying between the average total cost and average variable cost curves.

Answer:

Weekly leaderboard

Home
Homework Help 3,900,000
Economics 400,000
Start filling in the gaps now
Log in