conomics 8. Consider a firm whose production function is q(L) = 60L -0.5L² when hiring L hours of labor and assume labor expenses are the only costs to the firm. The firm is a competitive seller in the market of its products whose price is $5. a. If the firm is the competitive buyer in the labor market, derive its labor demand as a function of w, the wage rate in the labor market. b. Alternatively, suppose the firm is the monopsony in the labor market facing the inverse labor supply as W = 5L, find the wage rate it will pay the labors. c. How will the government regulate the market with the minimum wage rate to make it efficient? d. If the government sets a minimum wage equal to $200, find the hours of labors to be hired.

conomics 8. Consider a firm whose production function is q(L) = 60L -0.5L² when hiring L hours of labor and assume labor expenses are the only costs to the firm. The firm is a competitive seller in the market of its products whose price is $5. a. If the firm is the competitive buyer in the labor market, derive its labor demand as a function of w, the wage rate in the labor market. b. Alternatively, suppose the firm is the monopsony in the labor market facing the inverse labor supply as W = 5L, find the wage rate it will pay the labors. c. How will the government regulate the market with the minimum wage rate to make it efficient? d. If the government sets a minimum wage equal to $200, find the hours of labors to be hired.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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