Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter11: Labor Markets
Section: Chapter Questions
Problem 1SQ
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![Question 3
(a) Why does the labour demand curve slope downwards?
(b) A garment factory's production function is provided in the table.The gross profit per unit (difference between selling price and material cost, but not including the cost of labour) is $100.
# Workers Output
1
20
2
36
48
4
56
60
6
62
(i) If the wage rate is $1,000 a week, how many workers should the factory hire?
(ii) If a surge in popularity for the factory's brand allows them to raise the product price such that the gross profit rises to $150, how many workers will the factory hire now?
(iii) Calculate the number of garments produced in each of the two cases above.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8716085e-43b3-4b6e-b4fd-b090311c8d71%2Fd36f7506-09cc-43fd-adc0-d8c2b0a8465f%2F0izieg5_processed.png&w=3840&q=75)
Transcribed Image Text:Question 3
(a) Why does the labour demand curve slope downwards?
(b) A garment factory's production function is provided in the table.The gross profit per unit (difference between selling price and material cost, but not including the cost of labour) is $100.
# Workers Output
1
20
2
36
48
4
56
60
6
62
(i) If the wage rate is $1,000 a week, how many workers should the factory hire?
(ii) If a surge in popularity for the factory's brand allows them to raise the product price such that the gross profit rises to $150, how many workers will the factory hire now?
(iii) Calculate the number of garments produced in each of the two cases above.
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