Suppose a firm is currently employing 20 workers, the only variable input at a wage of $60. The average product of labor is 30, and the last worker added 12 units to the total output. Total fixed costs is $3,600 and the firms marginal cost at the current level of output is $5.

Consider that the market price is 7. is the firm producing at its profit maximizing level of output? should the firm change its production?

Given the market price of $7, at the firms current level of output, the value of the firms marginal product of labor is ______ and this is (equal to or greater than or less than)___________________________________________________ than the current wage rate. The firm (is, is not) _____________ producing at its profit maximizing level of output. To maximize its profit, the firm should (hire less workers, hire more workers, not change the amount of workers hired) __________________ and (increase, decrease, not change) ____________________ the amount of output it is currently producing.