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A manager of a firm with market power faces the marginal revenue product and average revenue product curves shown below. The firm incurs weekly fixed
A manager of a firm with market power faces the marginal revenue product and average revenue product curves shown below. The firm incurs weekly fixed costs of $1,800. The firm employs a single variable input, labor, which costs $600 per worker each week.
Given the information in the graph, suppose the weekly wage rate increases to $1,400 per worker. The firm would hire _____ workers and earn a profit of _____ per week.
- 6 ; $8,400
- 6 ; $6,000
- 6 ; $2,400
- 6 ; $4,800
- 0 ; $1,800
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