In the table below,the capital stock is fixed at 40 units,the price of capital is $15 per unit,and the price of labor is $80 per unit. $$\begin{array} { c c }
\text { Units of } & \text { Units of } \
\text { Labor } & \text { Output } \
\hline 5 & 40 \
10 & 100 \
15 & 180 \
20 & 220
\end{array}$$ If the firm produces 180 units of output,what is total variable cost?
A)$1,200
B)$1,800
C)$14,400
D)$17,100
E)none of the above

Question

In the table below,the capital stock is fixed at 40 units,the price of capital is $15 per unit,and the price of labor is $80 per unit. $$\begin{array} { c c } 
\text { Units of } & \text { Units of } \
\text { Labor } & \text { Output } \
\hline 5 & 40 \
10 & 100 \
15 & 180 \
20 & 220
\end{array}$$ If the firm produces 180 units of output,what is total variable cost?
A)$1,200
B)$1,800
C)$14,400
D)$17,100
E)none of the above

Quizplus · Accepted Answer

The total variable cost is calculated by multiplying the units of labor required to produce 180 units of output (15 units) by the price per unit of labor ($80). Thus, the total variable cost is 15 * $80 = $1,200.

In the Table Below,the Capital Stock Is Fixed at 40