Imagine a firm that employs two types of workers – some with computer skills and others with no technology related skills. (i) Explain how a firm’s production function is related to its marginal product of labour, how a firm’s marginal product of labour is related to the value of its marginal product and how a firm’s value of marginal product is related to its demand for labour. (ii) Explain how the wage can adjust to balance the supply and demand for labour while simultaneously equalling the value of the marginal product of labour.
Imagine a firm that employs two types of workers – some with computer skills and others with no technology related skills. (i) Explain how a firm’s production function is related to its marginal product of labour, how a firm’s marginal product of labour is related to the value of its marginal product and how a firm’s value of marginal product is related to its demand for labour. (ii) Explain how the wage can adjust to balance the supply and demand for labour while simultaneously equalling the value of the marginal product of labour.
Economics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506725
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter25: The Supply Of And Demand For Productive Resources
Section: Chapter Questions
Problem 9CQ
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Imagine a firm that employs two types of workers – some with computer skills and others with
no technology related skills.
(i) Explain how a firm’s production function is related to its marginal product of labour, how
a firm’s marginal product of labour is related to the value of its marginal product and how a
firm’s value of marginal product is related to its demand for labour.
(ii) Explain how the wage can adjust to balance the supply and demand for labour while
simultaneously equalling the value of the marginal product of labour.
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