Problems-
1. Use the following to answer the problem:
Production Data for Baseball Bat Company
No. of workers Total output (No. of bats)
0 0
1 20
2 42
3 66
4 94
5 124
6 150
7 170
8 184
9 194
10 200
11 204
12 202
13 198
14 190
In the table, average variable cost is at its minimum:
A) somewhere between the sixth and seventh workers.
B) for the fifth worker.
C) somewhere between the fifth and sixth workers.
D) for the third worker.
2. Assuming that price is greater than average variable cost, a profit maximizing monopolist will produce where:
A) Elasticity of demand is less than one.
B) Elasticity of demand is equal to one.
C) Elasticity of demand is greater than one.
D) There is no relationship between elasticity of demand and where a monopolist may choose to produce.
Additional Information-
These multiple choice problems belong to Economics. The first problem is about calculating the average variable cost of a firm and the second problem is about price being greater than average variable cost and the steps taken by profit maximizing monopolist.