ECONOMICS W/CONNECT+20 >C<
20th Edition
ISBN: 9781259714993
Author: McConnell
Publisher: MCG CUSTOM
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Chapter 16, Problem 5RQ
To determine
Marginal analysis.
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Lesson 7- Production
Question 10
LO 11.2: I can calculate marginal cost, revenue, and profit and distinguish between marginal cost
and average cost.
Suppose that Patrick's Handmade Puppets has a production cost that is given by
C(x) = 2,000 + 130x – 0.6x2 + 0.002x3 dollars
(0
Question 19
widget-manufacturing
The production function for a
firm is given by q = 9K0.5L0.5, where q is the number of widgets
produced each hour, K is the number of specialized staplers (which is fixed at 4 in the short run), and L is the
number of employees. What is the marginal product of labor at L = 9?
O 18
O 3
none of the above
Chapter 16 Solutions
ECONOMICS W/CONNECT+20 >C<
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- Let's assume that a firm produces 60 products. Its total weekly cost (TC) at this output is $2,100. This includes TVC and TFC. We also know that the firm employs 3 part- time workers at a wage cost of $600 per worker per week. This is the firm's only variable cost (TVC). What is the firm's average fixed cost (AFC) at this output? O $2.50. O $2. O $5. O $100. O $10. Let's assume that a firm's total weekly costs are as follows: 1. Salaries of hired workers $5,000. 2. Supplies = $1,000. 3. Rent = $600, 4. The owners have invested a certain amount of their own money into the business. This could have earned them interest of $200 per week if they had chosen to put it into a bank instead of investing it into their business. 5. The value of the owner's time is estimated to be $800 per week. What are the firm's total economic costs? O $6.000 O $7.600. O $900. $7.500. O $6.700.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_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_forward
- Employment 0 1 2 3 4 5 6 O 4-5 workers. 3-4 workers. Product O 0-1 workers. O 5-6 workers. 0 6 11 15 18 20 21 Price 5 5 5 5 5 5 On the basis of the information in the table above, if the firm is hiring workers under purely competitive conditions at a wage rate of $10, it will choose to employ between: 5 Revenue MRParrow_forwardAnswer fast....arrow_forwardUndercover World, a book shop, has the following marginal physical product curve (labeled MPP) for its hourly production. MPP and AP (Books per hour) 20 18 16 14 12 10 4 2 0 0 O 1 O O 2 3 QUANTITY OF LABOR 4 MPP 5 When labor increases from four to five workers, total product increases by AP per hour.arrow_forward
- 5arrow_forwardQuantity of Workers 0 1 2345 Total Product Select one: O a. 3 O b. 6 C. 2 O d. 4 0 7 18 30 40 48 Marginal Physical Product Marginal Revenue Product In the above table, if this is a perfectly competitive firm and the market price of the product is $5 and the marginal factor cost of labor is $60, how many units of labor will the firm hire?arrow_forwardWhich statement is false regarding unions? O a) With unions successfully raising wages for workers, it can also reduce overall employment. b) When unions drive up wages for workers, it results in an incentive for firms to hire more workers. OC) Unions drive up wages and benefits for workers by asserting market power over employers. O d) It is possible that raising wages for union workers can lead to higher productivity than nonunion workers because union workers are more likely to stay on the job longer.arrow_forward
- Please assist in filling out the chart.arrow_forwardAt the threat point, the union has payoff ___ and the firm has payoff ____. At outcome A, the union's gain is ____ and the firm's gain is ____.arrow_forward2. Consider a price-taking firm with total fixed cost of $80 and a market-determined price of $5 per unit for its output. The wage rate is $8 per unit of labor, the only variable input. Using the information provided, complete the table provided below. (7 pts) Marginal Total Revenue Variable Product Units of Labor Marginal Total Output Product Revenue Revenue Marginal Total Marginal Cost Cost Profit Cost 5 15 2 3 30 50 5 6 65 77 7 86 94 8 98 |10 96arrow_forward
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