Consider 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. Labor Output Marginal Product of Labor (Number of workers) (Units of output) (Units of output) Value of the Marginal Product of Labor (Dollars) WAGE (Dollars per worker) 500 450 400 350 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 sh the wage rate. (Note: If you cannot place the wage rate at the level you want, move the two end points individually.) 300 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 o the marginal product for the first worker should be plotted with a horizontal coordinate of 0.5, the value halfway between 0 and 1. Line segments w automatically connect the points. 250 200 150 100 50 0 0 1 2 0 3 4 5 1 0 16 31 45 56 64 16 15 14 11 LABOR (Number of workers) 00 The profit-maximizing quantity of labor at the market wage is 8 Demand Market Wage Rate
Consider 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. Labor Output Marginal Product of Labor (Number of workers) (Units of output) (Units of output) Value of the Marginal Product of Labor (Dollars) WAGE (Dollars per worker) 500 450 400 350 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 sh the wage rate. (Note: If you cannot place the wage rate at the level you want, move the two end points individually.) 300 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 o the marginal product for the first worker should be plotted with a horizontal coordinate of 0.5, the value halfway between 0 and 1. Line segments w automatically connect the points. 250 200 150 100 50 0 0 1 2 0 3 4 5 1 0 16 31 45 56 64 16 15 14 11 LABOR (Number of workers) 00 The profit-maximizing quantity of labor at the market wage is 8 Demand Market Wage Rate
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:Consider 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 of 0.5, the value halfway between 0 and 1. Line segments will
automatically connect the points.
350
300
250
200
150
100
50
0
0
1
2
3
4
5
0
1
0
16
2
31
45
56
64
3
LABOR (Number of workers)
16
15
14
11
8
The profit-maximizing quantity of labor at the market wage is
O
Demand
-O
Market Wage Rate
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