Principles of Economics, 7th Edition (MindTap Course List)
7th Edition
ISBN: 9781285165875
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 18, Problem 3QCMC
To determine
The competitive firm hiring labor.
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Students have asked these similar questions
A firm's demand curve for labor in a perfectly competitive market is the downward-sloping
portion of its
curve.
Select one:
a. average total cost
b. marginal revenue
C. total revenue
d. value of the marginal product of labor
10. The following is a total cost curve. Sketch the corresponding
marginal cost curve. If the price of output is $3 and there
are no fixed costs, what is the profit-maximizing level
of output?
The local ice cream shop is trying to figure out how many workers to hire, and part of the decision will be
based on the marginal product of labor. The following table shows a short-run production function for
quantity of ice cream tubs produced. Diminishing marginal returns begins after hiring which worker?
Workers hired
Quantity of ice cream tubs
produced
1
110
2
200
3
270
4
300
5
320
16
330
300
Seventh
Sixth
Second
Fourth
Chapter 18 Solutions
Principles of Economics, 7th Edition (MindTap Course List)
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- A small specialty cookie company, whose only variable input is labor, finds that the average worker can produce 100 cookies per day, the cost of the average worker is $32 per day, and the price of a cookie is $1.00. Is the firm maximizing profit? The firm A. is not maximizing profit because the marginal revenue product of labor is greater than the wage. B. is not maximizing profit because the marginal revenue product of labor is less than the wage. C. is maximizing profit because the marginal product of labor is greater than the wage. D. is not maximizing profit because the price of the output is not equal to the wage. E. is not maximizing profit because the marginal product of labor is greater than the wage.arrow_forwardWhich of the following determines the firm's demand curve for labor? a.The size of the labor force b.The marginal product of labor c.The total product of labor d.The average product of laborarrow_forwardEconomics The company A produces cars using three inputs, labour (L), capital (K)and talent (X). ACME's production function is Y(X, L, K) - х0.5LO.25к0.25 This problem only deals within the short run, where ACME's amount of capital is fixed at K = 9. Denote by w the labour wage, by r the price of capital and by q the price of talent. a) Find A's conditional input demand for talent and labour. b) Find A's cost function. What is its shutdown price (as a function of w, rand q)? c) Find A's short run supply function. Draw it together with any other curves. -х0.5L0.25 к0.25 %3Darrow_forward
- In the short run, a tool manufacturer has a fixed amount of capital. Labor is a variable input. The cost and output structure that the firm faces is shown in the table below. Calculate the total labor cost and the marginal resource cost, and then fill in the blanks in the labor supply table. Instructions: Enter your answers as a whole number. Marginal Resource Total Labor Units of Labor Total Product Wage Rate Cost (Labor) Cost 10 200 $7 11 214 8 12 226 9. 13 236 10 14 244 11 15 250 12arrow_forwarda and barrow_forwardStephanie is looking to hire workers to help her produce earrings. The current hourly market wage rate is $10 per worker. Assume this is a perfectly competitive market. Instructions: Enter your answers as a whole number. a. Fill in the "Total Labor Cost" and "Marginal Resource Cost" columns in the table below. Stephanie's Resource Costs Labor (workers) 0 1 2 3 4 5 6 7 $10 b. Graph the marginal resource cost of labor (MRC) for Stephanie's business. Instructions: Use the tool provided 'MRC' to plot the line point by point, starting from 1 worker up to 7 workers (7 points total). Wage Rate (dollars per hour) $12 $8 $6 Total Labor Cost (dollars per hour) $0 $4 $2 Marginal Resource Cost Marginal Resource Cost (dollars per hour) $ Tools / MRCarrow_forward
- Suppose that labor is the only input used by a perfectly competitive firm.The firm's production function is as follows:a.Calculate the marginal product for each additional worker.b.Each unit of output sells for $10.Calculate the marginal product for each additional worker.cCompute the demand for schedule showing the number of workers hired.arrow_forwardA small speciality cookie company, whose only variable input is labor, finds that the average worker can produce 25 cookies per day, the cost of the average worker is $128 per day, an the price of a cookie $0.50. Is the firm maximizing profit? Choose the answer. It is not maximizing profit because... a. the price of the output is not equal to the wage b. the marginal product of labor is less than the wage c. the marginal revenue product of labor is greater than the wage d. the marginal revenue product of labor is less than the wagearrow_forwardProPainters hires students at $250 a week to paint houses. It leases equipment at $500 a week. The table below sets out its total product schedule. Labor (students) 1 2 3 5 Output (houses painted per week) 2 5 9 12 14 15 If ProPainters paints 12 houses a week, calculate its average total cost? $104.2 per house. $41.7 per house. $83.3 per house. $125 per house.arrow_forward
- If a cost-minimization firm’s marginal product of labor equals 1 ton of output, while the marginal product of capital equals 7 tons of output and the cost of capital is $14 per unit, then A. The cost of labor must be $1/7 B. The cost of labor (wage rate) must be $2 C. The cost of labor must be $7 D. The cost of labor must be $14 as wellarrow_forwardthese are the drop down options Washes per hour dollarsarrow_forwardwhich of the following best describes marginal product?A.)Left over output- the loaves a bakery makes but does not sell that goes unused. B.) The total number of loaves a bakery can create with 5 workers and a fixed amount of capital. C.) The loaves made by a bakery using a substandard quality flour that ultimately harms business profits. D.) When the number of bakery staff increases from 2 to 3 bakers, 5 additional loaves are made.arrow_forward
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