Suppose that Paco charges $5000 for a paint job and that the current wage he must pay his workers is $20 per hour. How many worker hours should Paco use to maximize his profit? How many painting jobs will Paco complete using this number of worker hours? In addition to hiring workers, Paco spends $150 on brushes (50 brushes at $3 each) and $3000 on paint (100 gallons at $30 per gallon). What is Paco's profit using these values for his three factors (labor, brushes, and paint)? $
Suppose that Paco charges $5000 for a paint job and that the current wage he must pay his workers is $20 per hour. How many worker hours should Paco use to maximize his profit? How many painting jobs will Paco complete using this number of worker hours? In addition to hiring workers, Paco spends $150 on brushes (50 brushes at $3 each) and $3000 on paint (100 gallons at $30 per gallon). What is Paco's profit using these values for his three factors (labor, brushes, and paint)? $
Micro Economics For Today
10th Edition
ISBN:9781337613064
Author:Tucker, Irvin B.
Publisher:Tucker, Irvin B.
Chapter7: Proudction Costs
Section: Chapter Questions
Problem 2SQP
Related questions
Question
Pls solve ASAP....I will upvote your work
Transcribed Image Text:Paco's Painting Service does interior and exterior house painting. They have a production function that uses three factors: brushes (B), paint (P), and
labor (L). In the short run, Paco's has already committed to orders of brushes and paint, but can adjust the number of hours of labor they use from week
VE
to week. Therefore, their short-run production function depends only on labor and is given by f(L) = ,which implies that Paco's marginal product
of labor is MP, =
In the questions below, give all numerical answers to two decimal places.
Suppose that Paco charges $5000 for a paint job and that the current wage he must pay his workers is $20 per hour.
How many worker hours should Paco use to maximize his profit?
How many painting jobs will Paco complete using this number of worker hours?
In addition to hiring workers, Paco spends $150 on brushes (50 brushes at $3 each) and $3000 on paint (100 gallons at $30 per gallon).
What is Paco's profit using these values for his three factors (labor, brushes, and paint)? $
Transcribed Image Text:Now suppose that Paco is able to negotiate a lower price for paint and can buy the 100 gallons he needs for $27 instead of $30. Due to this
cost savings, Paco's profit-maximizing choice of labor will
and he will use
worker hours.
He will complete
projects (houses painted) and earn a profit of $
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
