A coal-mining company is the only employer in town, and faces this supply curve for labor 72 w=48+ L 2000 where w is the daily wage, in dollars, and L. is the number of workers employed. The company faces this demand curve for coal: P=60- 10 where p is the price of coal, per ton, and Q is the number of tons sold per day. Coalminers produce 8 tons of coal cach, per day, regardless of the number hired. The mining company maximizes profit. a) How many workers will be hired, and how much profit will be made? b) Suppose a union is formed, which sets a wage of $120 per day. At this wage, according to the supply curve given above, 2000 miners are willing to work, and the company is free to hire as many of these as it wants. How many will be hired, and how much profit will be made?
A coal-mining company is the only employer in town, and faces this supply curve for labor 72 w=48+ L 2000 where w is the daily wage, in dollars, and L. is the number of workers employed. The company faces this demand curve for coal: P=60- 10 where p is the price of coal, per ton, and Q is the number of tons sold per day. Coalminers produce 8 tons of coal cach, per day, regardless of the number hired. The mining company maximizes profit. a) How many workers will be hired, and how much profit will be made? b) Suppose a union is formed, which sets a wage of $120 per day. At this wage, according to the supply curve given above, 2000 miners are willing to work, and the company is free to hire as many of these as it wants. How many will be hired, and how much profit will be made?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
![A coal-mining company is the only employer in town, and faces this supply curve for labor
72
w=48+
L
2000
where w is the daily wage, in dollars, and L. is the number of workers employed. The company
faces this demand curve for coal:
P=60-
10
where p is the price of coal, per ton, and Q is the number of tons sold per day. Coalminers produce
8 tons of coal cach, per day, regardless of the number hired. The mining company maximizes
profit.
a) How many workers will be hired, and how much profit will be made?
b) Suppose a union is formed, which sets a wage of $120 per day. At this wage, according to
the supply curve given above, 2000 miners are willing to work, and the company is free to
hire as many of these as it wants. How many will be hired, and how much profit will be
made?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F31211817-c6fc-40e1-a7a5-5f5383d5e7ea%2F9bbc63d9-d84c-4403-9c8a-0e9a1e158593%2Fn5c5u1_processed.png&w=3840&q=75)
Transcribed Image Text:A coal-mining company is the only employer in town, and faces this supply curve for labor
72
w=48+
L
2000
where w is the daily wage, in dollars, and L. is the number of workers employed. The company
faces this demand curve for coal:
P=60-
10
where p is the price of coal, per ton, and Q is the number of tons sold per day. Coalminers produce
8 tons of coal cach, per day, regardless of the number hired. The mining company maximizes
profit.
a) How many workers will be hired, and how much profit will be made?
b) Suppose a union is formed, which sets a wage of $120 per day. At this wage, according to
the supply curve given above, 2000 miners are willing to work, and the company is free to
hire as many of these as it wants. How many will be hired, and how much profit will be
made?
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 2 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Recommended textbooks for you
![ENGR.ECONOMIC ANALYSIS](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Principles of Economics (12th Edition)](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
![Engineering Economy (17th Edition)](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
![ENGR.ECONOMIC ANALYSIS](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9780190931919/9780190931919_smallCoverImage.gif)
![Principles of Economics (12th Edition)](https://www.bartleby.com/isbn_cover_images/9780134078779/9780134078779_smallCoverImage.gif)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
![Engineering Economy (17th Edition)](https://www.bartleby.com/isbn_cover_images/9780134870069/9780134870069_smallCoverImage.gif)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
![Principles of Economics (MindTap Course List)](https://www.bartleby.com/isbn_cover_images/9781305585126/9781305585126_smallCoverImage.gif)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
![Managerial Economics: A Problem Solving Approach](https://www.bartleby.com/isbn_cover_images/9781337106665/9781337106665_smallCoverImage.gif)
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
![Managerial Economics & Business Strategy (Mcgraw-…](https://www.bartleby.com/isbn_cover_images/9781259290619/9781259290619_smallCoverImage.gif)
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education