8. Suppose the marginal product of labor is MPN = 200 - 0.5N where N is aggregate employment. The aggregate quantity of labor supplied is 300 + 8w, where w is the real wage. What is the equilibrium real wage? a. 5 b. 10 C. 15 d. 20
Q: Givens: w * L+r+K min L>0, K > 0 s.t. % <K L5 • The marginal product of labor: MPL = .5 * * • The…
A: A production function illustrates the relationship between the output and the inputs used. It…
Q: markets to show how the change in A affects the supply of capital, the supply of labor, the real…
A: Answer:-As per rule of economy when demand increases the supply and its consumption also increase.…
Q: 7) The following figure illustrates the labor demand curve, LD1, and labor supply curve, LS1, in…
A: A person is called unemployment if he is currently not working but currently looking for work but…
Q: Which of the following statements correctly describes the demand for labor? A. The higher the…
A: The demand for labor is downward sloping because of two reasons. 1. As the wage rate increases, the…
Q: Pizza production requires labor (cooks) and capital (ovens). If the wage rate for cooks is $15 per…
A: Given, The wage rate for cooks = $15 per hour The rental rate on ovens = $20 an hour The MPP for…
Q: 5. Suppose that due to a strong caution from the American Dental Association, the demand for caramel…
A: Value Marginal Product (VMP) is the extra income produced by adding one more labour unit (or other…
Q: The lines on the graph are budget constraints, showing the tradeoff between labor and leisure.…
A:
Q: If the per unit price of labor, a variable resource, increases, it causes which of the following? A.…
A: Per unit price of labor is termed as wages. An increase in wages will shift the total variable cost…
Q: Refer to the graph to answer this question. Which of the following will make Labor Demand for Grotto…
A: The movement from D1 to D2 would be the rightward movement which occurs due to an increase in demand…
Q: Suppose a firm finds itself in a situation where the marginal product of the last employee hired is…
A: Introduction One of the biggest economic problems for an entrepreneur is choosing the correct mix of…
Q: Decent Donuts Total product dozens of donuts per) Labor (workers) (day 12 1 26 44 64 4 86 110 122 7.…
A: The average product (AP) of labor is calculated by dividing the total product (TP) by the number of…
Q: Givens: w*L+r* K min L20, K 20 s.t. • The marginal product of labor: MPL = .5 • The marginal product…
A: The following problem has been solved as follows:
Q: Part a. What is the marginal physical product(MPP) of the third unit of labor hired? Part b. What is…
A: The marginal revenue productivity theory states that a profit maximizing firm will hire workers up…
Q: marginal product of labor for a firm Is defined by the following equation: MPN = A(100- N)" a. If…
A: Nominal wage, or money wage, is the literal amount of money you get paid per hour or by salary. here…
Q: ... Assume that the price of a car wawsh is $10 and the marginal product of labor at the car wash is…
A: Marginal product is the change in total product due to an additional labor hired. Marginal revenue…
Q: It deals with the Production Function, Marginal Rate of Technical Subsition . Problem: The…
A: The production is given as follows-
Q: In order to maximize profits, a firm needs to determine the quantity of each factor that it will…
A: The formula:Marginal product =Change in total productMPL(2)=32-24=8MRPL=MPL* priceMRPL(2)=8*3=24
Q: 1. Define the Labor Participation Rate (LFP). Then, for each of the following explain what is likely…
A: Labor is a resource that is provided by workers, often in return for a salary that is paid by…
Q: 16. Bob White argues that if his wage went up from $10/hour to $20/hour he would still be able to…
A: Economics as a subject was introduced to help gap the distance between equity and equality. Since…
Q: 8 Suppose that a firm with ordinary-shaped isoquants and that wants to produce a certain level of…
A: The equilibrium is given by the point : MPn/Pn=MPK/PK or MPn / MPk = Pn / Pk
Q: The labor demand is given by N = 400 - w/A where w is the real wage, N is the quantity of labor…
A: The given information is: Labor demand : N = 400 -wA A=2 W=406 N is the quantity of labor demanded…
Q: 4. For the production function Q = F(L) = 4\L, calculate the labor demand function, and the output…
A: Firm will maximise profit at a long where wage is equal to values of marginal product of labor.
Q: Suppose P = $144, MPL = 39, and APL = 26, MPK = 72, and APK = 45. What is the value marginal product…
A: The additional revenue generated by employing one more unit of a specific input, such as labor or…
Q: Other things held constant, suppose that demand for the final product increases. i. Using the labor…
A: Labor demand represents the quantity of labor that employers are willing to hire at various wage…
Q: Question2 Imagine that you own a company that is a price taker with the production function:…
A: The production function is the functional relationship between the production elements and the…
Q: Units of labor Opportunity cost of a worker in terms of units output = real wage required by an…
A: The equilibrium wage rate is the rate at which the quantity demanded of labour equates with the…
Q: Kelsey owns a cotton candy shop that employs 7 people. The employees are paid $12 per hour, and a…
A: Factors of production are paid according to their marginal productivity. The profit maximisation…
Q: Suppose an economy has the following production function: Y = AK L where A = 10, K 50, and L= 100.…
A: Given production function :- Y = AK1/3L2/3 w = $20 P = $4 A = 10, K = 50, L = 100
Q: True or false: Equilibrium employment is given by the intersection of the wage and the profit curves
A: Wages represent the money paid to the labor for hiring their services whereas profit curves…
Q: Givens: min w L+r * K L20, K 0 s.t. 9o SK L • The marginal product of labor: MPL .5 K • The marginal…
A: A production function tells the relationship between the output and the inputs used. It shows the…
Q: The Labor Supply (curves) for any given occupation: illustrate that as wage rates (W) rise, more…
A: Option A is Correct Labor Supply curve indicates that as the wage rate rises, more people will be…
Q: 3.2 An increase in the amount of capital in the economy will shift the demand for labor curve to…
A: The production function of the firms in the economy will be directly related to the levels of…
Q: 10. Recently, some college alumni started a moving service for students living on campus. They have…
A: Production refers to the process of producing goods and services using inputs such as capital and…
Q: Suppose the marginal product of labor in the economy is given by MPN-200-0.5N, while the supply of…
A: Demand curve is the downward sloping curve. Supply curve is the upward sloping curve. Equilibrium is…
Q: suppose there is an adverse supply shock. It would a. Shift the production function up and…
A: An adverse supply-side shock is an occasion that makes a sudden expansion in expenses or…
Q: The Upstart Company has the following production function. Number of Workers 0 1 2 3 4 5 Number of…
A: In a perfectly competitive market, labor will be hired till the marginal product of the last unit of…
Q: On the following graph, use the blue points (circle symbol) to plot the firm's labor demand curve.…
A: Labour Output Marginal product of Labour 0 0 1 20 20 2 39 19 3 57 18 4 72 15 5 84 12…
Q: 6. Suppose the hourly wage is $40, the price of each unit of capital is $50, and the price of output…
A: Note: There are multiple sub parts of the given question, therefore we shall answer only the first…
Q: Question2 Imagine you work for a firm that only utilizes labor and capital as inputs and has a CES…
A: A neoclassical production function that exhibits continuous elasticity of the substitution is the…
Q: 17. If a firm's MPL = 2.0 when that firm hires 25 units of labor to produce 100 units, then which of…
A: Firm is hiring the labor to produce the output and for each unit of labor hire there is change in…
Q: The wage gap is usually defined as the real wage divided by labor productivity. O True O False
A: In an economy, productivity of labor explains the ability of the workers to generate output.
Q: If the marginal product of labor is less than the nominal wage divided by the price of output, a…
A: Marginal Product of Labor: The marginal product of labor is the additional output or production that…
Q: Which of the following statements correctly describes the demand for labor? O A. The higher the real…
A: Demand refers to the quantity of a good or service that the consumers are willing to buy at various…
Q: 2. Which of the following statements is true? a. The labor supply curve is the sum of all the…
A: Labor supply curve is the horizontal sum of individual marginal dis-utility, so (a) is false. Hiring…
Q: Suppose Taco Hut currently doesn't offer its employees any health insurance. However, the government…
A: Wages: It refers to the income of the people that they will receive when they do any work. The…
Q: 4. At Tuxi's, tacos cost $2.50 (p=2.5) and the market wage for labor is $12.50. a. Calculate the…
A: Profit is maximized when firm hires workers at a level where marginal revenue product of labor is…
Q: Describe the effects of a rightward shift in labor demand on labor market equilibrium: Decrease…
A: The quantity of workers that companies seek to hire at a specific wage rate over a specific time…
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
- Consider a company operating in a competitive market. The company sells units of output and receives a price of $20 per unit, and pays a daily market wage of $330 to each worker it employs. 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) (Dollars) 0 0 20 1 20 19 2 39 18 3 57 15 4 72 12 5 84 On the following graph, use the blue points (circle symbol) to plot the firm's labor demand curve. Then, use the orange line (square symbols) to show the wage rate. (Note: If you cannot place the wage rate at the level you want, move the two end points individually.) Hint: Remember to plot each point halfway between the two integers. For example, when the number of workers increases from 0 to 1, the…Look at the diagram below. Let's assume that aggregate demand declines and a recession occurs, which causes a decrease in the demand for labor. Assuming prices, wages and salaries are sticky, then what is the total excess labor? Salary $45,000 $25,000 5000 11000 19000 Labor S D₁ DoConsider Blewitt's Farm, a small blueberry grower relative to the size of the market whose production has no impact on wages and prices. The following table presents Blewitt's production schedule for blueberries: Labor Output (Number of workers) (Pounds of blueberries) 0 WAGE (Dollars per worker) 300 270 240 210 Suppose that the market wage for blueberry pickers is $200 per worker per day, and the price of blueberries is $13 per pound. 180 On the following graph, use the blue points (circle symbol) to plot Blewitt's labor demand curve when the output price is $13 per pound. Note: Remember to plot each point between the two integers. For example, when the number of workers increases from 0 to 1, the value of the marginal product of for the first worker should be plotted with a horizontal coordinate of 0.5, the value halfway between 0 and 1. Line segments will automatically connect the points. 150 120 60 1 30 2 3 4 0 5 0 20 38 54 68 80 O Demand P = $13 Demand P = $15 (?)
- Look at the graph below. Labor demand falls from D0 to D1 due to an economic recession. What is the resulting wage in the short-run due to this shift in demand? HINT: Consider whether this is a situation in which the wages are sticky or flexible. Wage Rate 40 35 30 25 20 15 10 5 0 5 10 15 20 25 30 Quantity of Labor D1 35 40 DOQuestion1 Imagine you work for a firm that only utilizes labor and capital as inputs and has a CES production function: q = f(L, K) = [aLº + BK²] = Where a = 3 = 0.5.y 1.p = 0.5. a. What is the MPL ? What does this mean economically? b. What is the MPK? What does this mean economically? c. What is the MRTS? What does this mean economically? d. Does this CES function have constant, increasing, or decreasing returns to scale?4) If the marginal product of capital MPK > r, where r is the market rental rate for capital, the firm A. Should hire more capital until MPK = r. B. Should hire more labor until MPK = r. C. Should hire more labor until MPK = 0. D. Should fire more capital until MPK = r. %3D 5) Figure 1 below shows the dynamics of per-capita GDP for six countries in ratio scale from 1870 to 2010. From the Figure we learn that the level of per capita GDP A. Has almost doubled for the US from 1880 to 2020 B. Was higher in the U.S. compared to the UK in 1880 C. Was higher in China compared to Argentina in 2000. D. Increased by approximately 5 times in Japan from 1950 to 1970. Answer 64,000 U.S. 32,000 16,000 Argentina 8,000 U.K. 4,000 Japan 2,000 S. Africa China 1,000 1880 1900 1920 1940 1960 1980 2000 2020
- Use a graph of labor supply and labor demand to illustrate the impact of each of the folllwing events on the equilibrium wage rate and the equilibrium level of employment in a labor market. (Analyze these as two separate unrelated events). Be sure to label your graph clearly to show the direction of the shift as well as an initial equilibrium and the new equilibrium after the event. A. A decline in the productivity of this type of labor B. An increase in the preference for work versus leisure.in an economy with production function Y = 1.5 × K^0.3L^0.7, K = 343, and L = 512. If factor markets are in equilibrium, then the rental price of capital is (approximately) ________, and the real wage is (approximately) ________. A) 0.5; 0.8 B) 7; 8 C) 0.9; 1.35 D) 1.4; 0.4 E) 0.6; 0.9To say that the demand for labor is a derived demand means that the demand for labor depends upon the demand for the product produced by labor O the supply of labor rises when the demand for labor falls changes in the demand for labor lead to changes in the demand for the product produced by labor the quantity of labor is derived by the real wage rate
- Q1). Suppose the labor market is initially at its equilibrium, i.e., the labor supplied equals the labor demanded. Now suppose IBM develops a new computer chip that makes computer incredibly faster. Explain and show graphically how the arrival of a new, more productive technology affects the labor market. Draw the full graph and provide a detailed explanation of the effect. Label the axes/curves, explain why either the aggregate labor demand curve or the aggregate labor supply curve shifts and describe the economic mechanism that moves the economy from the old to the new equilibrium.Question 73 of 80 If a firm finds that, at its current level of employment, VMP > W, it will A. be minimizing profits. B. be maximizing profits. C. decrease the amount of labor it hires. D. increase the amount of labor it hires. 1Consider a company operating in a competitive market. The company sells units of output and receives a price of $30 per unit, and pays a daily market wage of $285 to each worker it employs. In the following table, complete the column for the value of the marginal product of labor (VMPL) at each quantity of workers. Value of the Marginal Product of Labor Labor Output Marginal Product of Labor (Number of workers) (Units of output) (Units of output) (Dollars) WAGE (Dollars per worker) 500 450 On the following graph, use the blue points (circle symbol) to plot the firm's labor demand curve. Then, use the orange line (square symbols) to show the wage rate. (Note: If you cannot place the wage rate at the level you want, move the two end points individually.) 400 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 for the first worker should be plotted with a horizontal coordinate…