Purchase Solution

The marginal revenue product of labour

Not what you're looking for?

Ask Custom Question

Please see attached file.

The following information pertains to a perfectly competitive firm that sells its output for $2 in the short run and is one of many demanders of labor.

(i) Fill in the blanks in the above table.
(ii) How many workers would the firm hire if the wage rate was $10?
(iii) Explain why this firm would not hire 2 workers, even if the wage rate was $24.

B) Explain using graphs and accompanying explanation why this firm's demand curve is more elastic than the labor demand curve in the market.

Attachments
Purchase this Solution

Solution Summary

The marginal revenue product of labour is determined.

Solution Preview

The following information pertains to a perfectly competitive firm that sells its output for $2 in the short run and is one of many demanders of labor.
(i) Fill in the blanks in the above table.

The value of MP & VMP are calculated in the above table

(ii) How many workers would the firm hire if the wage rate was $10?

If the wage rate is $10, the firm will ...

Purchase this Solution


Free BrainMass Quizzes
Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.

Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.

Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.

Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.