The following table shows the relationship between output an

The following table shows the relationship between output and number of workers in the short run. If the wage is $50/day, find the marginal cost of production.

Year    CPI                 Year    CPI                 Year    CPI

            1992    140.3               1998    163.0               2004    188.9

            1993    144.5               1999    166.6               2005    195.3

            1994    148.2               2000    172.2               2006    201.6

            1995    152.4               2001    177.1               2007    207.3

            1996    156.9               2002    179.9               2008    215.3

    1997    160.5               2003    184.0               2009    214.5

Solution

Marginal cost = $50 which is labour cost.