Exhibit 27-7 Refer to Exhibit 27-7. The marginal factor cost of increasing employment from 20 to 30 workers is
A)$14.
B)$8.
C)$17.
D)$120.
E)$170.

Question

Exhibit 27-7 ​  Refer to Exhibit 27-7. The marginal factor cost of increasing employment from 20 to 30 workers is
A)$14. 
B)$8. 
C)$17. 
D)$120. 
E)$170.

Quizplus · Accepted Answer

The marginal factor cost is calculated as the change in total cost divided by the change in employment. From the graph, we can see that the change in employment from 20 to 30 workers is 10. The change in total cost for this increase is approximately $170 (the difference between the cost at 30 workers and the cost at 20 workers). Therefore, the marginal factor cost is $170/10 = $17. The correct answer is C.

Exhibit 27-7 ​ Refer to Exhibit 27-7

Exhibit 27-7 Refer to Exhibit 27-7