Question

Table 13-5

Number of Workers	Output
0	0
1	1,000
2	2,000
3	2,700
4	3,200
5	3,500
6	3,600

Refer to Table 13-5. Assume that fixed costs are $500, and variable costs are $100 per worker. For this firm, what are the shapes of the production function and the total-cost curve?

Group of answer choices

Both the production function and total-cost curve are increasing at a decreasing rate.

The production function is increasing at an increasing rate, whereas the total-cost function is increasing at a decreasing rate.

Both the production function and total-cost curve are increasing at an increasing rate.

The production function is increasing at a decreasing rate, whereas the total-cost function is increasing at an increasing rate.

Answer 1

W	Q	FC	VC	TC
0	0	500	0	500
1	1000	500	100	600
2	2000	500	200	700
3	2700	500	300	800
4	3200	500	400	900
5	3500	500	500	1000
6	3600	500	600	1100

4000 3500 3000 2500 2000 1500 1000 500 о 1 2 4 6 7

ТC 1200 1000 800 600 TC 400 200 1000 2000 3000 4000

The production function is increasing at a decreasing rate, whereas the total-cost function is increasing at an increasing rate.