Microeconomics
21st Edition
ISBN: 9781259915727
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Question
Chapter 17, Problem 3DQ
To determine
Individual and market supply curve.
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Students have asked these similar questions
A single firm is the only employer in a labour market. The marginal revenue product, labour supply, and
marginal factor cost curves that it faces are displayed in the diagram below. Use this information to answer the
following questions.
1. How many units of labour will this firm employ in order to maximize it's economic profits?
2. what hourly wage rate will this firm pay it's workers?
3. What is the total amount of wage payments that this firm will make to its workers each hour?
per Hour ($)
Wage Rate, Marginal Factor Cost,
Revenue Product
and Marginal
28
20
13
10
0
1
3
1
C
S
X
MFC
MRP
1000
1600
Quantity of Labour per Time Period
Problem 51: With the table below showing the firm's outputs given the labor inputs:
Labor
1
2
3
4
5
7
Quantity
Total Output 20
35
47
57
65
70
a. Identify the profit maximizing labor quantity if w = $16/hr. and P of Q = $2/unit
b. Determine the same as letter (a) but the wage is higher at w = $20/hr.
c. Determine the same as letter (a) but the P of Q is now $3.5/unit
Dolls are fabricated in a process with two resources. The first resource has a capacity of 1.5 dolls per hour.
The capacity of the second resource is 0.99 dolls per hour. The first resource has 7 workers and the second
resource has 9 workers. Demand for this process is 1.1 dolls per hour. Wages are $24 per hour.
Instruction: Round your answer to two decimal places.
What is the cost of direct labor (in $)?
per unit
Chapter 17 Solutions
Microeconomics
Ch. 17.3 - Prob. 1QQCh. 17.3 - Prob. 2QQCh. 17.3 - Prob. 3QQCh. 17.3 - Prob. 4QQCh. 17.A - Prob. 1ADQCh. 17.A - Prob. 2ADQCh. 17.A - Prob. 3ADQCh. 17.A - Prob. 4ADQCh. 17.A - Prob. 1ARQCh. 17.A - Prob. 2ARQ
Ch. 17.A - Prob. 3ARQCh. 17.A - Prob. 4ARQCh. 17.A - Prob. 1APCh. 17.A - Prob. 2APCh. 17 - Prob. 1DQCh. 17 - Prob. 2DQCh. 17 - Prob. 3DQCh. 17 - Prob. 4DQCh. 17 - Prob. 5DQCh. 17 - Prob. 6DQCh. 17 - Prob. 7DQCh. 17 - Prob. 8DQCh. 17 - Prob. 9DQCh. 17 - Prob. 10DQCh. 17 - Prob. 1RQCh. 17 - Prob. 2RQCh. 17 - Prob. 3RQCh. 17 - Prob. 4RQCh. 17 - Prob. 5RQCh. 17 - Prob. 6RQCh. 17 - Prob. 7RQCh. 17 - Prob. 1PCh. 17 - Prob. 2PCh. 17 - Prob. 3PCh. 17 - Prob. 4PCh. 17 - Prob. 5P
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- In the short run, a tool manufacturer has a fixed amount of capital. Labor is a variable input. The cost and output structure that the firm faces is depicted in the following table Suppose that for the firm, the goods market is perfectly competitive. The market price of the product is $5 at each quantity supplied by the firm Marginal Factor Cost Total Physical Product 100 109 77 117 108 124 143 130 182 135 225 What is the amount of labor that this profit-maximizing firm will hire? workers (Enter a numerio response using an integer) Labor Supplied 10 11 12 13 14 15 Hourly Wage Rate (5) 7 9 11 13 15 Total Wage Cost 50 27 31 35 39 43 Sitearrow_forwardAssume a firm is a monopsonist that can hire its first worker for $6 but must increase the wage rate by $3 to attract each successive worker. Draw the firm’s labor supply and marginal resource cost curves and explain their relationships to one another. On the same graph, plot the labor demand data of question 2. What are the equilibrium wage rate and level of employment? Why do these differ from your answer to question 9?arrow_forwardThe following diagram depicts a firm's demand curve given the economy-wide demand, and its tangent isoprofit curve. The firm faces a linear demand curve. The workers' average product of labour X equals 1. At B, which of the following statements is correct? Price, p: dollars 80+ W = 60 Iso-profit curve Demand curve Production function: q = n Quantity, q: Employment, n, given a production function where APL = A=1 200 a) Profits are $16,000. b) The slope of the isoprofit curve is -0.4. c) The marginal rate of substitution is -0.1. d) The markup is 0.1.arrow_forward
- 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 $70.00. As a result of this collective bargaining agreement, Zippy will the number of workers it hires to hire workers.arrow_forwardThe following diagram provides the demand for labour (DL) of a remote gold mine, and the local community's supply of labour (SL). The mining company has a monopsony in the local labour market. W ($ per week) 2000 1500 1000 500 0 L (miners) 5 10 15 20 25 30 1. Use the information in the diagram to provide an equation for the demand for labour function and the supply of labour function. Show your work in the space provided. 0 SL 2. From the information in the diagram, estimate the mine's expenditure on labour (E) function its marginal expenditure on labour (ME) function. Show your work in the space provided. 3. The profit maximizing monopsonist will Q = miners and pay them a wage w = $_ week. Show your work in the space provided and in the above diagram. 4. The Dead-weight-loss from monopsony is DWL = $_ this paper and on the above diagram. Show your work on the back of perarrow_forwardConsider the Labor Economics Question. This will provide insight into the idea of the optimal number of workers and the value of the marginal product of labor. If wages in the restaurant is $16.80 per hour and the price of a Hamburger is $8.30 and the production function for the workers is: Q = 11L – 0.25L2 How many workers should Your Restaurant employ during the lunch hour to maximize profits? 1 Point (note—the value of the marginal product of labor and the marginal revenue product are the same) We maximize profits which are total revenues less total costs:arrow_forward
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