The Zippy Paper Company has no control over either the price of paper or the wage it pays its workers. The following table shows the relationship between the number of workers Zippy hires, total output, marginal product, and marginal revenue product of labor, with all other inputs being held constant. Assume that the selling price is $10 per box of paper. Labor Input Total Output Marginal Product Marginal Revenue Product Price = $10 (Workers per day) (Boxes of paper per day) (Boxes of paper per day) (Dollars) 0 0 14 2 26 36 44 5 50 AAAAAA 14 $140 12 $120 10 $100 8 $80 64 $60 $40 6 54 If the wage rate is $50.00 per day, Zippy will hire workers. Suppose that the workers in this industry have unionized and have collectively bargained for a wage of $70.00. As a result of this collective bargaining agreement, Zippy will the number of workers it hires to hire workers.
The Zippy Paper Company has no control over either the price of paper or the wage it pays its workers. The following table shows the relationship between the number of workers Zippy hires, total output, marginal product, and marginal revenue product of labor, with all other inputs being held constant. Assume that the selling price is $10 per box of paper. Labor Input Total Output Marginal Product Marginal Revenue Product Price = $10 (Workers per day) (Boxes of paper per day) (Boxes of paper per day) (Dollars) 0 0 14 2 26 36 44 5 50 AAAAAA 14 $140 12 $120 10 $100 8 $80 64 $60 $40 6 54 If the wage rate is $50.00 per day, Zippy will hire workers. Suppose that the workers in this industry have unionized and have collectively bargained for a wage of $70.00. As a result of this collective bargaining agreement, Zippy will the number of workers it hires to hire workers.
Chapter11: The Firm: Production And Costs
Section: Chapter Questions
Problem 8P
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Transcribed Image Text:The Zippy Paper Company has no control over either the price of paper or the wage it pays its workers. The following table shows the relationship
between the number of workers Zippy hires, total output, marginal product, and marginal revenue product of labor, with all other inputs being held
constant. Assume that the selling price is $10 per box of paper.
Labor Input
Total Output
Marginal Product
Marginal Revenue Product
Price =
$10
(Workers per day)
(Boxes of paper per day)
(Boxes of paper per day)
(Dollars)
0
0
14
2
26
36
44
5
50
AAAAAA
14
$140
12
$120
10
$100
8
$80
64
$60
$40
6
54
If the wage rate is $50.00 per day, Zippy will hire
workers.
Suppose that the workers in this industry have unionized and have collectively bargained for a wage of $70.00.
As a result of this collective bargaining agreement, Zippy will
the number of workers it hires to hire
workers.
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