Consider a newspaper in a small town that has monopsony power in hiring journalists. The following table shows the labor hours that will be supplied at each of the given hourly wages, as well as the total cost of labor at each quantity of labor. Suppose the newspaper's demand for labor as a function MVP of the marginal value product of labor (MVPL) is given by L = 8- . Compute the marginal expense (MEL) and marginal value product (MVP) of adding an additional hour at each quantity and enter the values into the following table. Labor Supplled Total Labor Cost MEL MVPL Hourly Wage (Hours) (Dollars per hour) (Dollars per hour) (Dollars per hour) 3 6. 2. 12 9. 27 12 4. 48 15 75 The following graph depicts the supply of labor in this market. Use the grey polnts (star symbol) to plot the marginal expense at the five quantities of labor given in the previous table. Then use the blue points (circle symbol) to plot the firm's demand for labor as a function of the MVPL.
Consider a newspaper in a small town that has monopsony power in hiring journalists. The following table shows the labor hours that will be supplied at each of the given hourly wages, as well as the total cost of labor at each quantity of labor. Suppose the newspaper's demand for labor as a function MVP of the marginal value product of labor (MVPL) is given by L = 8- . Compute the marginal expense (MEL) and marginal value product (MVP) of adding an additional hour at each quantity and enter the values into the following table. Labor Supplled Total Labor Cost MEL MVPL Hourly Wage (Hours) (Dollars per hour) (Dollars per hour) (Dollars per hour) 3 6. 2. 12 9. 27 12 4. 48 15 75 The following graph depicts the supply of labor in this market. Use the grey polnts (star symbol) to plot the marginal expense at the five quantities of labor given in the previous table. Then use the blue points (circle symbol) to plot the firm's demand for labor as a function of the MVPL.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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