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

Long-run costs and economies of scale — practice question

The diagram shows MRPL as a firm’s marginal revenue product of labour curve, S as its supply of labour curve, and MCL as its marginal cost of labour curve. If profit maximisation is assumed, how many workers will be employed by the firm, and what wage will it pay?

  • AN1 employed, wage W3
  • BN1 employed, wage W1
  • CN2 employed, wage W2
  • DN2 employed, wage W4

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