15. A competitive firm sells its output for $45 per unit. The marginal product of the 30th worker is 4units of output per day; the marginal product of the 31st worker is 3 units of output per day. The firmpays its workers a wage of $150 per day.a. for the 31st worker, the marginal profit is $135b. for the 30th worker, the value of the marginal product of labor is $600c. for the 30th worker, the marginal profit is $180d. none of the above is correct

Marginal Revenue Product = Marginal Physical product*Marginal Revenue Value of Marginal product = Marginal Physical product*Price. In the competitive market: P = MR=AR, thus Marginal Revenue product and Value of Marginal product are equal.Answer: (D) All of these statements are wrong. Marginal profit for 31st worker = 45*3 - 150 = 135 - 150 = - 15 Thus, Option (a) is wrong Value of Marginal product = MPP*Price = 45*4 = 180 Option B is wrong Marginal profit of 30th worker: 180 - 150 = 30 C option is wrong as well.

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Economics

5. A competitive firm sells its output for $45 per unit. The marginal product of th nits of output per day; the marginal product of the 31st worker is 3 units of outp ays its workers a wage of $150 per day. . for the 31st worker, the marginal profit is $135 . for the 30th worker, the value of the marginal product of labor is $600 for the 30th worker, the marginal profit is $180 |. none of the above is correct

5. A competitive firm sells its output for $45 per unit. The marginal product of th nits of output per day; the marginal product of the 31st worker is 3 units of outp ays its workers a wage of $150 per day. . for the 31st worker, the marginal profit is $135 . for the 30th worker, the value of the marginal product of labor is $600 for the 30th worker, the marginal profit is $180 |. none of the above is correct

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question 2. Using below information to fill in the table below. The table sets out Sue's Surfboards' total product schedule. Sue's Surfboards hires workers at $500 a week and its total fixed cost is $1,000 a week. Labor Output AP MPL TVC TFC TC 6 7 2 4 S 1 3 30 70 120 160 190 210 220 30 35 40 40 38 35 31,42 40 0 50 40 30 20 10 ATC AFC AVC MC
2.back to Barry's ice making plant described in problem 1, the price of party ice falls to 25¢ a bag but bagger's wages remain at $10.00 an hour. a. What happens to Barry's marginal product? b. What happens to his value of marginal product? c. What happens to his demand for labour curve? d. What happens to the number of baggers that he employs? 3. Back at Barry's party ice shop described in problem, 1, bagger's wages increase to $20 an hour, but the price of ice remains at 50¢ a bag. a. What happens to his value of marginal product? b. What happens to Barry/s demand for labour curve? c. How many baggers does Barry employ? 4. What is discounting? What is present value? How do the two relate?
A. In the resource market, what is the impact on the demand for coal if the price of the substitute good, natural gas increases? B. The table below represents a perfectly competitive market, if the industry price is $18, calculate the marginal revenue product for the second and third workers. No of Employees 1 2 3 No of Washes 10.00 19.00 26.00 C. Explain why the Value of the Marginal Product Marginal Revenue Product for perfect competitors but these values are not equal for the monopolistic competitors. D. In a company, if the Marginal Revenue Product of the 8th worker hired is less than the MRC for that worker, should the firm hire the 9th worker? Explain E. Graph the resource market for passenger and freight train engineers. Show the change in the wage rate and quantity of workers hired if there is a very large number of engineers retiring and the demand for rail travel has increased in the last year. =
Labor 1 2 3 4 5 TP (or q) 5 22 APL 6 5 The price of labor, w, is $210 per unit and the price at which a competitive firm can sell its output is $30 per unit. In the short run it will hire A. 0 units of labor (shut down) B. 2 units of labor C. 3 units of labor D. 4 units of labor E. 5 units of labor The price of labor, w, is $210 per unit and the price at which a competitive firm can sell its output is $70 per unit. Its fixed costs are $100. In the short run, the firm makes a profit of A. -$100 B. $500 C. $530 D. $600 E. $700 MPL 6
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2. Suppose the marginal cost of hiring an additional unit of labor is $10 and the value of the marginal product from hiring this additional unit of labor is $12 . To maximize profit, this firm should hire: a. more labor. b. less labor.
Number of Workers 0 1 2 3 4 5 Output Select one: O a. $400. O b. $200. O c. $100. d. $500. 0 100 280 Marginal Product of Labor 80 60 20 Value of Marginal Product of Labor $1,000 $800 $400 Wage $500 $500 $500 $500 $500 Marginal Profit $500 $100 Refer to the table above. To maximize its profit, the firm will hire workers as long as the value of the marginal product of labour equals or exceeds
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8. The law of diminishing marginal product holds that as a variable input increases while other inputs are fixed, ______.a. eventually the fixed inputs will increase at a rate equal to or below the variable increasesb. labor demanded will be high at both very low and very high outputs creating a U-shaped curvec. the marginal revenue product will eventually cause the labor demand curve to turn upwardd. at some point the increase will lose its effectiveness, and additions to output will decline
11. Fresh Veggie is one of many small farms in Florida operating in a perfectly competitive market. Farm labor is also perfectly competitive, and Fresh Veggie can hire as many workers as it wants for $20 a day. The daily productivity of a tomato picker is given in the table. If a bushel of tomatoes sells for $6, how many workers will Fresh Veggie hire? Also, fill in MP of Labor and VMPL columns.
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