In the figure below, the marginal cost of the last unit produced by the profit m
ID: 1220801 • Letter: I
Question
In the figure below, the marginal cost of the last unit produced by the profit maximizing firm is: A. $5 B. $10 C. $15 D. $20 Consider the UAE government introducing an effective minimum wage policy for all workers employed in oil companies in the country. Which of the following statements is correct? A. All Cost curves, except the Fixed Cost, will shift upwards B. All Cost curves, except the Fixed Cost, will shift downwards C. All Cost curves (i.e., Fixed, Variable and Total) will shift upwards D. All Cost curves (i.e., Fixed, Variable and Total) will shift downwards A firm's shutdown point is the quantity and price at which the firm's total revenue just equals its: A. Total cost B. Total variable cost C. Total fixed cost D. Marginal cost.Explanation / Answer
27.
B. $10
At $10, marginal revenue equals marginal cost. Thus, at this marginal cost, last unit of product is produced.
28.
A. all cost curves, except fixed cost, will shift upwards.
Wages are not considered as the part of fixed cost. Thus, changing in minimum wages will not be affecting the fixed cost. But, it will affect variable cost, total cost and marginal cost curves.
29.
B. Total variable cost
If a firm earns revenue less than the variable cost then, firm will go for shut down. Thus, total revenue equaling total variable cost is considered as shut down point.