Homework Answers
42. Marginal revenue product is the product of marginal product and price of output. Here for L = 4, MPL is 2 units and P is 4. Hence MRP is 2 x 4 = $8. Select $8. Option B
43. Since wage rate is $8 and Price is 4, MPL = 8/4 = 2 units and MPL is 2 units when 4th worker is hired. Thus, firm should hire 4 workers. Option D.
44. Opportunity cost of leisure is the wage rate itself. Hence wage rate is higher, opportunity cost is higher as well. Option A.
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42. If the price of output is $4 per unit, what is the marginal revenue product...
38. An increase in the supply of labor с.increases the value of ~ginal Product of er...
38. An increase in the supply of labor с.increases the value of ~ginal Product of er and enes D. decreases the value of the marginal product of labor and increases the wage the wage. 39. A decrease in the demand for fish A. decreases the value of the marginal product of fishemen reduces their wage, and reduces employment in the fishing industry employment in the fishing industry employment in the fishing industry employment in the fishing industry B. increases the...
29. A firm produces in a perfectly competitive market and hires labor in a perfectly competitive...
29. A firm produces in a perfectly competitive market and hires labor in a perfectly competitive labor market. The firm hires four workers, the marginal product of the fourth worker is 4, and the wage rate is $40. The firm produces 100 units of the product, which sell for a price of $10. This firm is a. maximizing profit when it hires four workers. b. not maximizing profit and should hire more workers to increase profit. c. not maximizing profit...
A company operates in a competitive market, selling each unit of output for a price of...
A company operates in a competitive market, selling each unit of output for a price of $30 and paying the market wage of $405 per day for each worker it hires. In the following table, complete the column for the value of the marginal product of labor (VMPL) at each quantity of workers. Hint: Remember to plot each point halfway between the two integers. For example, when the number of workers increases from 0 to 1, the value of the marginal product...
Name: 1. Consider a firm that hires workers (L) and produces output (Q). a. If the...
Name: 1. Consider a firm that hires workers (L) and produces output (Q). a. If the firm charges a price of $1 per unit output (P) and pays a nominal wage of $8 per worker (W), fill in the values in the following table, where MPL is marginal product of labor (units per worker), VMPL is the value of the marginal product of labor ($ per worker), and W/P is the real wage (units per worker). Labor Output MPL Price...
Leadbelly Co. Sells pencils in a perfectly competitive product market and hires in a perfectly competitive...
Leadbelly Co. Sells pencils in a perfectly competitive product
market and hires in a perfectly competitive labor market. assume
that the market wage rate for workers is $150 per day.
A.
What rule should Leadbelly follow to hire the profit-maximizing
amount of labor?
B.
At the profit-maximizing level of output, the marginal product of
the last work or hired is 30 boxes of pencils per day. Calculate
the Price of a box of pencils.
C.
Draw a diagram of the...
4. Marginal resource cost A company operates in a perfectly competitive market, selling each unit of...
4. Marginal resource cost
A company operates in a perfectly competitive market, selling
each unit of output for a price of $20 and paying the market wage
of $330 per day for each worker it hires.
In the following table, complete the column for the value of the
marginal product of labor (VMPL) at each quantity of workers.
Labor
Output
Marginal Product of Labor
Value of the Marginal Product of Labor
(Number of workers)
(Units of output)
(Units of output)...
1a) Consider an economy where output is produced using just labor as input. Output is sold...
1a) Consider an economy where output is produced using just labor as input. Output is sold at $10 per unit and the marginal product of labor for each worker hired is expressed as MPL=10-2L. If each worker is paid $40, what would be the total profit of the profit-maximizing entrepreneur? a. $40 b. $60 c. $0 1b) Consider an economy where output is produced using just labor as input. Output is sold at $10 per unit and the marginal product...
vimizing rule for all firms in resource markets is The profit maximizing a) mrc = mvp...
vimizing rule for all firms in resource markets is The profit maximizing a) mrc = mvp b) mc>mp c) trc > trp di mic sp Figure 13.1 00+ Input price (Dollars per unit) - ---- -- MRC EKM -- -- ----MRP 10 20 30 40 50 Units of input Figure 13.1 shows marginal revenue product and marginal resource cost curves for a certain firm. In order to maximize profit, the firm should a) hire 30 units of this resource. b)...
4. Marginal resource cost A company operates in a perfectly competitive market, selling each unit of...
4. Marginal resource cost A company operates in a perfectly competitive market, selling each unit of output for a price of $20 and paying the market wage of $270 per day for each worker it hires. In the following table, complete the column for the value of the marginal product of labor (VMPL) at each quantity of workers. Labor (Number of workers) 0 Output Marginal Product of Labor (Units of output) (Units of output) Value of the Marginal Product of...
Deciding how many workers to hire: Assume that the initial price of shoes in this example is $30 per pair
1. Deciding how many workers to hire: Assume that the initial price of shoes in this example is $30 per pair. What is the marginal revenue product for each worker? Fill in the following chart and graph each function.Number of workers01234567Total Output Of shoes08152126293130Marginal Output of shoesMarginal Revenue Product (a.k.a. value of the marginal product of labor)a. If it costs the firm $90 per worker per day, how many workers would be hired? Why? b. If the price of shoes was...
38. An increase in the supply of labor с.increases the value of ~ginal Product of er and enes D. decreases the value of the marginal product of labor and increases the wage the wage. 39. A decrease in the demand for fish A. decreases the value of the marginal product of fishemen reduces their wage, and reduces employment in the fishing industry employment in the fishing industry employment in the fishing industry employment in the fishing industry B. increases the...
29. A firm produces in a perfectly competitive market and hires labor in a perfectly competitive labor market. The firm hires four workers, the marginal product of the fourth worker is 4, and the wage rate is $40. The firm produces 100 units of the product, which sell for a price of $10. This firm is a. maximizing profit when it hires four workers. b. not maximizing profit and should hire more workers to increase profit. c. not maximizing profit...
Name: 1. Consider a firm that hires workers (L) and produces output (Q). a. If the firm charges a price of $1 per unit output (P) and pays a nominal wage of $8 per worker (W), fill in the values in the following table, where MPL is marginal product of labor (units per worker), VMPL is the value of the marginal product of labor ($ per worker), and W/P is the real wage (units per worker). Labor Output MPL Price...
Leadbelly Co. Sells pencils in a perfectly competitive product
market and hires in a perfectly competitive labor market. assume
that the market wage rate for workers is $150 per day.
A.
What rule should Leadbelly follow to hire the profit-maximizing
amount of labor?
B.
At the profit-maximizing level of output, the marginal product of
the last work or hired is 30 boxes of pencils per day. Calculate
the Price of a box of pencils.
C.
Draw a diagram of the...
4. Marginal resource cost
A company operates in a perfectly competitive market, selling
each unit of output for a price of $20 and paying the market wage
of $330 per day for each worker it hires.
In the following table, complete the column for the value of the
marginal product of labor (VMPL) at each quantity of workers.
Labor
Output
Marginal Product of Labor
Value of the Marginal Product of Labor
(Number of workers)
(Units of output)
(Units of output)...
vimizing rule for all firms in resource markets is The profit maximizing a) mrc = mvp b) mc>mp c) trc > trp di mic sp Figure 13.1 00+ Input price (Dollars per unit) - ---- -- MRC EKM -- -- ----MRP 10 20 30 40 50 Units of input Figure 13.1 shows marginal revenue product and marginal resource cost curves for a certain firm. In order to maximize profit, the firm should a) hire 30 units of this resource. b)...
4. Marginal resource cost A company operates in a perfectly competitive market, selling each unit of output for a price of $20 and paying the market wage of $270 per day for each worker it hires. In the following table, complete the column for the value of the marginal product of labor (VMPL) at each quantity of workers. Labor (Number of workers) 0 Output Marginal Product of Labor (Units of output) (Units of output) Value of the Marginal Product of...
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