ECONOMICS W/CONNECT+20 >C<
20th Edition
ISBN: 9781259714993
Author: McConnell
Publisher: MCG CUSTOM
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Question
Chapter 16, Problem 2RQ
To determine
The number of workers that can be hired by the firm.
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Complete the following labor supply table for a firm hiring labor competitively: LO17.2
Show graphically the labor supply and marginal resource (labor) cost curves for this firm. Are the curves the same or different? If they are different, which one is higher?
Plot the labor demand data of review question 2 in Chapter 16 on the graph used in part a above. What are the equilibrium wage rate and level of employment?
The table below shows your production function relating output per number of hired workers (assume no changes to the
capital and size of the convenient store.
Use the given information to find the Marginal Product of Labor.
Workers Total Output
0
0
1
2
3
4
LO
5
90
149
182
197
202
Marginal Product
A
OHire a number of workers where marginal product is positive
OHire a number of workers where marginal product is negative
OHire the number of workers where marginal product is maximized
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What should determine the number of workers to hire if your goal is to maximize efficiency?
OHire as many employees as possible
OHire the minimum number of workers
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WAGE
7. Shifts in labor supply
Assume that the consulting and information technology industries employ people with similar skills. Suppose an increase in the demand for computer
analysts leads to a rise in their wages, while the demand for consultants remains the same.
The following graph shows the labor market for consultants in the United States.
Show the effect of the rise in demand for computer analysts on the U.S. labor market for consultants by shifting the labor demand curve, the labor
supply curve, or both.
Supply
Demand
Supply
Demand
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Chapter 16 Solutions
ECONOMICS W/CONNECT+20 >C<
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- 5 MC Qu. 16-35 (Algo) Refer to the given table.... Employment 0 1 2 3 4 S 6 Multiple Choice O O Total Product 0 Refer to the given table. If the firm is hiring workers under purely competitive conditions at a wage rate of $38, it will employ O O 12 22 30 36 40 42 Tworker 2 workers. 3 workers Product Price $5 Sworkers 5 5 5 5 5 5 0arrow_forwardEmployment 0 1 2 3 4 5 6 Labor Demand Data Total Product 0 15 28 о Multiple Choice о O $18 $17 39 48 55 60 $15 $16 Product Price $2.20 2.00 1.80 1.60 1.40 1. 20 1.00 The table shows labor demand data on the left and labor supply data on the right. What will be the profit-maximizing wage rate? Labor Supply Data Employment 0 1 2 3 4 LO 5 6 Wage Rate $15.00 16.00 17.00 18.00 19.00 20.00arrow_forwardThe table below shows a firm that is perfectly competitive in both the labor and product markets, showing how much daily output a firm can produce using various numbers of workers. Number of Workers 1 2 3 4 5 6 Output O $2 O $460 O $115 O $100 O $40 3 9 16 21 23 24 If output sells for $20/unit, what is the marginal revenue product of the 5th worker?arrow_forward
- Ella owns a factory that produces kitchen knives. She has eight employees, with which her factory can produce 120 knives per day. If she hired a ninth employee, she'd be knives. able to produce 130 wheelbarrows per day. Therefore, the marginal product of the ninth employee is O 12 O 10 O 15 O 14 O 11arrow_forwardSuppose that the wage rate is $13 per hour and the price of the product is $2. Values for output and labor are in units per hour. b. L 0. 24 44 60 72 80 4 84 Find the profit-maximizing quantity of labor. (Assume the firm can hire up to 6 workers.) The profit-maximizing quantity of labor is worker(s). (Enter a numeric response using an integer.) Suppose that the price of the product remains $2 but that the wage rate increases to $36. Find the new profit maximizing level of L The profit-maximizing quantity of labor is worker(s). Suppose that the price of the product decreases to $1 and the wage remains at $13 per hour. Find the new profit-maximizing L.arrow_forwardIf, by increasing the qulf, by increasing the quantity of labour used by one unit, the firm can give up 2 units of capital and still produce the same output, then the MRTSLK is: antity of labour used by one unit, the firm can give up 2 units of capital and still produce the same output, then the MRTSLK is: O 4 O 1 O 2 O 0.5arrow_forward
- Lesson 7- Production Question 10arrow_forward2. Complete the following labor demand table for a firm that is hiring labor competitively and selling its product in a competitive market: Now assume that the firm is selling in an imperfectly competitive market and that, although it can sell 17 units for $2.20 per unit, it must lower product price by 5 cents in order to sell the marginal product of each successive labor unit (that is to sell 31 units of output it has to lower the price to $2.15, etc). Use the table above to calculate the firm's demand curve under this assumption. Make sure to put the appropriate price for each product level. Plot the two demand curves. Which curve is more elastic? If the market wage is $19.95, how many workers will each firm hire? Explain your answer.arrow_forwardFigure 17-2 Marginal revenue product of labor 56 48 40 36 28 20 11 0 O 1 2 3 4 5 Marginal revenue product of labor Quantity of labor Figure 17-2 shows the marginal revenue product for Becca's Baubles, a producer of hand-beaded bracelets. Refer to Figure 17-2. Suppose the market price of bracelets falls to $2. What happens to the curve given in the diagram? O Nothing, because labor's productivity has not changed. There will be a movement along the curve. The curve shifts to the left. C We cannot answer the question without knowing if Becca would want to hire more workers.arrow_forward
- 21.arrow_forwardAssume Manfred's Shoe Shine Parlor hires labor, its only variable input, under purely competitive conditions. Shoe shines are also sold competitively. Units of Labor 0 1 2 3 4 5 6 7 Multiple Choice O O 42 44 5 Total Marginal Product Product 0 14 40.5 30 35 39 44 How many units of output are produced when 6 workers are employed? 14 10 2 Total Revenue $84 180 234 252 264arrow_forwardMay you tell me, which one is correct? Thank you so much.arrow_forward
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