2) The demand for labor by an industry is given buy the curve L = 900 - 20w, where L is the labor demanded per day and w is the wage rate. The supply curve is given by L = -100 + 20w. a. b. What is the wage rate and quantity of labor hired? What is the economic rent earned by workers?
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- What determines the demand for labor for a firm operation in a perfectly competitive out market?1. Why is a firm's demand for labor considered a 'derived demand?' What is it derived from? 2. The marginal cost of labor (MCL) is equal to what for a firm that operates in a competitive labor market? How does this compare with the MCL for a monopsony.A firm faces a perfectly elastic demand for its output at a price of $6 per unit of output. The firm, however, faces an upward-sloped labor supply curve ofE = 20w - 120where E is the number of workers hired each hour and w is the hourly wage rate. Thus, the firm faces an upward-sloped marginal cost of labor curve ofMCE = 6 + 0.1EEach hour of labor produces five units of output. How many workers should the firm hire each hour to maximize profits? What wage will the firm pay? What are the firm’s hourly profits?
- If the population of the United States suddenlygrew because of a large wave of immigration,what would happen to wages? What wouldhappen to the rents earned by the owners of landand capital?O Macmillan Learning Suppose a firm's marginal revenue product (MRP) curve is currently MRP, on the accompanying graph. Which curve would most likely result if the output price fell? cannot be determined MRPy MRP₂ MRPx Wage 10 8 7 6 5 4 3 2 1 MRP X MRP MRP y Z 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Quantity of labor Time remaining: 01:59:36 Economics Operum is a firm that hires unskilled laborers in a perfectly competitive factor market. (a) Draw side-by-side graphs for the whole labor market and for Operum. Label the market supply SL, the market demand DL, the equilibrium wage WE, the equilibrium quantity QE, the wage paid by Operum WO, and the quantity hired by Operum QO. (b) Is WE greater than, equal to, or less than the marginal factor cost of unskilled labor at QO? Explain. (c) The government institutes an effective minimum wage for unskilled labor. Illustrate this on your graphs from part (a). Label the minimum wage WMin. On the graph for Operum, label the new quantity of unskilled labor employed QMin. (d) Ceteris paribus, how will the minimum wage from part (c) affect the market's demand for unskilled labor and its quantity demanded unskilled labor—will each increase, decrease, or stay the same? Explain. (e) Will the minimum wage cause the marginal revenue product of Operum's last…
- Suppose the supply of soccer players is give by the the equation Ls=W/10 and the valu of the marginal product is given by VMPL=100,000 - 100LD. Question 1 Compute the equilibrium number of players hired in a competitive labor market. Round to the nearest whole number. Question 2 Compute the equilibrium the wage paid to each player in a competitive labor market. Round to the nearest dollar.3) A paper factory signed contract to produce 1000 reams of paper each week for a customer. The paper plant's production function is Q = 4K0.75 L0.25, where Q is output (reams produced), K is the quantity of capital rented, and L is the quantity of labor hired. Each worker is paid $10 per hour and each machine rents for $60 per hour. a. What is the MRTSLK? Demonstrate. b. Find the optimal amount of Labor and capital that is needed to produce 1,000 reams per week. c. What is the firms' total cost of producing the 1,000 reams? d. Draw a diagram of the iso-quant and the iso-cost lines and identify the optimal input combination. e. Suppose the firm needs to increase production to 1,100. Without redoing the full analyses, determine how much additional labor and capital will be needed to achieve this. (This is a one-line answer).8.The demand for labor by an industry is given by the curve L = 1200 – 10w, where L is the labor %3D demanded per day and w is the wage rate. The supply curve is given by L = 20w. What is the equilibrium wage rate and quantity of labor hired? What is the economic rent earned by workers?
- Demand for Resources A small manufacturing company has the following daily relationship between labor and output: Units of Total Labor Product 1 2 21 3 35 52 61 65 61 7 If the firm sells into a perfectly competitive market and the equilibrium price is $3.25 per unit, compute the following: Marginal Units of Marginal Product Revenue Labor Product 1 2 3 5 7 How many workers will the firm hire is the market wage rate (includining benefits) is $30.00? Wł 3 How many workers will the firm hire is the market wage rate(includining benefits) is $20.00? 4 If the equilibrium price per unit of output dencreases, what would you expect to happen to the number of workers hired? If the firm sells in a imperfectly competitive market such that price per unit starts at $4.50 per ur declines by $0.10 per unit as more as sold, what do you think would happen to the number of labor units hired at $30.00 per unit? 5 2.Suppose a campus restaurant increases the number of workers it hires from 3 workers per day to 11 workers per day. As a result, its total revenue increases from $135 per day to $550 per day. a. Assuming that each worker is equally productive, what is the marginal revenue product per day of each additional worker? $ b. Assuming the restaurant is using its resources in a profit-maximizing way, and that each worker works 5 days each week, what is the current weekly wage rate in the labor market? $ per weeksuppose Fred produces 500 litres of milk every day with 10 workers. the price of milk is $12 per litre, and each worker is paid $550 daily. if th margin product of the last worker employed is 40 litres of milk, explain whether Fred is maximizing his profit. If not, can Fred incrase his profit by employing more or fewer workers? If Fred buys more dairy cattles, how will it affect his demand for labor? Explain with a diagram.