Micro Economics For Today
10th Edition
ISBN: 9781337613064
Author: Tucker, Irvin B.
Publisher: Cengage,
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Question
Chapter 7, Problem 3SQ
To determine
The impact of decreasing marginal product of labor.
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Students have asked these similar questions
Which of the following statements best describes the Diminishing Returns to Labor:Select one:Oa. Workers are paid less.as more of them are hired by the firm.Ob. Workers get paid less as they work more.Oc: The firm's output decreases as more workers are hired.Od. Each additional worker adds less to the production as the Marginal Product of Labor is decreasing.
A firm in a competitive market should hire workers up to the point where the value of the marginal product of labor =
a. the wage
b. total revenue
c. total cost
d. total profit
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 well
Chapter 7 Solutions
Micro Economics For Today
Ch. 7.5 - Prob. 1YTECh. 7 - Prob. 1SQPCh. 7 - Prob. 2SQPCh. 7 - Prob. 3SQPCh. 7 - Prob. 4SQPCh. 7 - Prob. 5SQPCh. 7 - Prob. 6SQPCh. 7 - Prob. 7SQPCh. 7 - Prob. 8SQPCh. 7 - Prob. 9SQP
Ch. 7 - Prob. 10SQPCh. 7 - Prob. 11SQPCh. 7 - Prob. 1SQCh. 7 - Prob. 2SQCh. 7 - Prob. 3SQCh. 7 - Prob. 4SQCh. 7 - Prob. 5SQCh. 7 - Prob. 6SQCh. 7 - Prob. 7SQCh. 7 - Prob. 8SQCh. 7 - Prob. 9SQCh. 7 - Prob. 10SQCh. 7 - Prob. 11SQCh. 7 - Prob. 12SQCh. 7 - Prob. 13SQCh. 7 - Prob. 14SQCh. 7 - Prob. 15SQCh. 7 - Prob. 16SQCh. 7 - Prob. 17SQCh. 7 - Prob. 18SQCh. 7 - Prob. 19SQCh. 7 - Prob. 20SQCh. 7 - Prob. 21SQCh. 7 - Prob. 22SQCh. 7 - Prob. 23SQCh. 7 - Prob. 24SQCh. 7 - Prob. 25SQ
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- Which of the following describes the law of diminishing returns to labor? A. When one more worker got hired their marginal product was negative B. When one more worker got hired total product of the firm went down C. When one more worker got hired their marginal product was lower than the marginal product of the previous workerarrow_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_forwardA 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 laborarrow_forward
- Using a diagram explain what happens to the long-run demand curve for labor if the price of labour increases? Decompose the changes into scale and substitution effects.arrow_forwardA 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_forwardThe marginal product of the 14 th worker is 8 and the firm sells its output for $4 per unit. If labor is the only variable cost, then the value of the 14 th worker's marginal product is $2. $4. $12. $32.arrow_forward
- Suppose the marginal product is maximized when the 10th worker is hired. Then the marginal cost value is minimized when a. fewer than 10 workers are hired. b. an unknown number of workers are hired. Marginal cost is independent of marginal product. C. more than 10 workers are hired. Od. 10 workers are hired.arrow_forward8arrow_forwardThe 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 Fourtharrow_forward
- Firms will hire additional workers as long as the wage: a) is less than the marginal product of labor. b) equals the marginal product of labor. c) is greater than the marginal product of labor. d) is less than the value of the marginal product of labor.arrow_forwardRefer to the table below. Diminishing marginal productivity begins when the: A). third worker is hired. B). fourth worker is hired. C). fifth worker is hired. D). sixth worker is hired.arrow_forwardWhy is the long run labor demand curve more elastic than the demand for labor in the short run? Group of answer choices a. In the long run, firms are better able to substitute capital for labor than in the short run. b. Firms are more likely to shut down in the long run c. Firms face diseconomies of scale in the short run, but economies of scale in the long run d. The demand for labor is perfectly inelastic in the short run, but perfectly elastic in the long runarrow_forward
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