A firm faces the following costs: total cost of capital = $4,000; price paid for labor = $20 per labor unit; and price paid for raw materials = $8 per raw-material unit. Initially, the firm can produce 2,000 units of output by combining its fixed capital with 200 units of labor and 500 units of raw materials. After the firm improves its production process, it can produce 3,000 units of output by combining its fixed capital with 100 units of labor and 500 units of raw materials. How will the firm's total costs change as a result of the improved production process? Instructions: Enter your answers as a whole number. Total cost changes from $ using the original process to $ using the improved process.

A firm faces the following costs: total cost of capital = $4,000; price paid for labor = $20 per labor unit; and price paid for raw materials = $8 per raw-material unit. Initially, the firm can produce 2,000 units of output by combining its fixed capital with 200 units of labor and 500 units of raw materials. After the firm improves its production process, it can produce 3,000 units of output by combining its fixed capital with 100 units of labor and 500 units of raw materials. How will the firm's total costs change as a result of the improved production process? Instructions: Enter your answers as a whole number. Total cost changes from $ using the original process to $ using the improved process.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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