BUS 207 Study Guide - Quiz Guide: Marginal Revenue, Variable Cost, Average Variable Cost

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In the short run, is it possible for a firm to change inputs: yes, any and all inputs can be changed, yes, although only small input changes are possible, not completely; one or more inputs are fixed d. It depends on the duration of the short run. As labor usage increases, the marginal product of labor: first falls, then rises, first falls, reaches a flat portion, and then rises rapidly, first rises, then falls, first rises, then falls, then rises again. Firm x sells output at p=4 per unit and pays labor a wage of 20 per hour. The marginal product of labor is given by mpl=30-0. 1l. The firm hires labor at a wage of 16 per hour and sells the good in a competitive market at p=8 per unit. Find the firm"s optimal use of labor and associated level of output. Suppose that a firm is producing in the short run with output given by q=10l-0. 25l^2.

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