Economics 9708 · AS & A Level · Long-run costs and economies of scale

Long-run costs and economies of scale — practice question

A firm is perfectly competitive in both product and factor markets, and labour is the only variable factor input. In the diagram, line JK represents the link between the marginal physical product of labour and the hours worked. If the marginal revenue of the product is $1.60 and the firm employs 3000 hours of labour, what is the hourly wage?

  • A$0.40
  • B$2.40
  • C$5.60
  • D$6.40

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