The marginal product of labor for a firm is given by: MPL = 188 - 4H, where H is the number of hours they hire workers to work. For example, the marginal product of the first hour of labor would be 188 -4*1, and the marginal product of the second hour of labor would be 188 - 4*2. If the market wage is $18 per hour, how many hours of labor will this firm hire? Round your final answer to two decimal places.

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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**Calculating the Optimal Hours of Labor for a Firm**

The marginal product of labor (MPL) for a firm is given by the equation: 
\[MPL = 188 - 4H\]
where \(H\) is the number of hours they hire workers to work.

For example:
- The marginal product of the first hour of labor would be \(188 - 4 \times 1\).
- The marginal product of the second hour of labor would be \(188 - 4 \times 2\).

**Question:**

If the market wage is $18 per hour, how many hours of labor will this firm hire?

*Round your final answer to two decimal places and provide detailed calculations that support this decision.*

This example enables students to understand how firms determine the optimal number of labor hours to hire based on the marginal product of labor and market wages. It involves applying economic theory and basic algebra to solve optimization problems in labor economics.
Transcribed Image Text:**Calculating the Optimal Hours of Labor for a Firm** The marginal product of labor (MPL) for a firm is given by the equation: \[MPL = 188 - 4H\] where \(H\) is the number of hours they hire workers to work. For example: - The marginal product of the first hour of labor would be \(188 - 4 \times 1\). - The marginal product of the second hour of labor would be \(188 - 4 \times 2\). **Question:** If the market wage is $18 per hour, how many hours of labor will this firm hire? *Round your final answer to two decimal places and provide detailed calculations that support this decision.* This example enables students to understand how firms determine the optimal number of labor hours to hire based on the marginal product of labor and market wages. It involves applying economic theory and basic algebra to solve optimization problems in labor economics.
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