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Mumz [18]
3 years ago
14

If the Market Equilibrium Wage Rate is $105.00 and FC = $1500.00: A. The firm Shuts Down and hires no workers and loses $1500.00

B. The firm hires 45 workers and earns a $1200.00 Economic Profit C. The firm hires 55 workers earns a $975.00 Economic Profit D. The firm hires 40 workers and earns a $1200.00 Economic Profit
Business
1 answer:
BartSMP [9]3 years ago
6 0

Answer: B. The firm hires 45 workers and earns a $1,200.00 Economic Profit

Explanation:

If the Market Equilibrium rate is $105 then the company should hire 45 workers as shown in the table.

If they did that, revenue would be $7,425

Expenses would be wages and fixed costs:

= Wages + fixed costs

= (45 workers * wage rate) + 1,500

= (45 * 105) + 1,500

= $6,225

Economic profit would be:

= 7,425 - 6,225

= $1,200

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