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Scenario: the Scenario Above Changes, Because an Increase in the Wages

Question 106

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Scenario: The scenario above changes, because an increase in the wages of workers at Plant 2 causes marginal costs and average total costs at Plant 2 to rise:
Plant 2: New marginal cost: MC₂ = 20 + 2Q,
Plant 2: Average total cost: ATC₂ = 20 + Q.
Costs at Plant 1 do not change.
Scenario: The scenario above changes, because an increase in the wages of workers at Plant 2 causes marginal costs and average total costs at Plant 2 to rise: Plant 2: New marginal cost: MC₂ = 20 + 2Q, Plant 2: Average total cost: ATC₂ = 20 + Q. Costs at Plant 1 do not change. -Refer to the scenario above.Given costs have changed at Plant 2,what are the firm's total profits now that is maximizing profits but facing different costs at each facility? Explain your answer. A) $3,200 B) $3,625 C) $4,000 D) $4,050
-Refer to the scenario above.Given costs have changed at Plant 2,what are the firm's total profits now that is maximizing profits but facing different costs at each facility? Explain your answer.


A) $3,200
B) $3,625
C) $4,000
D) $4,050

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