Answer:
1) 1.25
2) 1600.00
3) 250,000 pennies
Explanation:
Given:
•Number of workers, n = 2,500
•Output per month =4,000,000 units
•Current total variable costs = $5,000,000
1) For average variable costs:
Average variable costs =
Total variable costs/output.p.month
=
= 1.25
2) Average product of labour will be:
Average product of labour =
Output per month/n
= 1,600.00
3) Monthly wage for each worker will be given as:
Monhly wage =
Total variable costs/n
Therefore, monthly wage for each worker =
= $2,500 => 250,000 pennies