## Costs in the Short Run

Read this section about how to calculate costs in the short-run like variable and marginal costs. Make sure to answer the "Try It" questions.

### LEARNING OBJECTIVES

#### Answer to Try It Question

• $135 Correct. 3 workers are required to produce 45 units/hour and each gets paid at$15 so labor cost if 3 * $15 =$45. The cost of material is $2 per unit so 45 *$2 = $90 is the cost of material. Total cost for 45 units =$45 + $90 -$135

•  Number of Workers Production (units/hr) Cost per worker per hour Total labor cost Cost of Materials Total Cost 1 10 $15$15 20 35 2 30 $15$30 60 90 3 45 $15$45 90 135 4 55 $15$60 110 170 5 60 $15$75 120 195

• $105 Incorrect. 3 workers are required to produce 45 units/hour and each gets paid at$15 so labor cost is 3 * $15 =$45. The cost of material is $2 per unit so$45 * $2 =$90 is the cost of material. Total cost for 45 units = $45 +$90 - $135. •$47
Incorrect. Don't forget the cost of material for 45 units. The cost of material is $2 per unit so$45 * 2 = $90 is the cost of material. 3 workers are required to produce 45 units/hour and each gets paid at$15 so labor cost if 3 * $15 =$45. Total cost for $45 units =$45 + $90 -$135.