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    Consider a firm that has just built a plant, which cost $20,000. Each worker costs $5.00 per hour. Based on this information, fill in the table below.

    Number of Worker Hours Output Marginal Product Fixed Cost VariableCost TotalCost MarginalCost AverageVariableCost Average Total Cost
    0 0 -- 20,000 -- -- --
    50 400 20,250
    100 900 20,500
    150 1300 20,750
    200 1600 21,000
    250 1800 21,250
    300 1900 21,500
    350 1950 21,750

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    Solution Preview

    Please see the attached file.

    Marginal cost of output are additional cost incurred in producing an additional output.
    Variable costs are costs which changes directly in proportion to the level of sales in dollars or units sold. For example direct material, direct labor, sales commission, bonus etc.
    Fixed costs are those costs which remain the same ...

    Solution Summary

    Cost types are noted.