Question

2) The following Table shows the technology of production at Happy Farms for 2001. a) Complete the Table by calculating MPL and MRPL (assume potatoes sell for $2 per bushel) Workers Total Bushels of Marginal rginal Potatoes per day Product of Labor Product of Labor p- $2 40 70 90 100 105 102 b) If the wage rate is S30 per day, how many workers should be hired per day? Explain your answer. c) If workers unionized, and the wage rises to $50 per day, how many workers should be hired? Explain your answer d) Assume that Happy Farms adopts new planting and harvesting technology that doubles output at each level of employment. Assume that the price of potatoes per bushel remains constant at $2. Complete the table below to indicate the effect this new technology has had on MPL and MRPL Total Bushels of MarginalMarginal Revenue Potatoes per day Workers Product of Product of Labor Labor e) If the wage rate is $50 per day, how many workers should be hired?

Answer 1

number of workers selected are such that the wage given to them is less than or equal to the MRPL. that is the contribution of each new worker in monetary terms

DA PA 26 MAP Po 12 hs 3