This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: The above table has the marginal product schedule for a firm. If the firm is a perfect competitor ... (Read 112 times)

joblessjake

  • Hero Member
  • *****
  • Posts: 555
on: Jun 29, 2018
The above table has the marginal product schedule for a firm. If the firm is a perfect competitor and the price of the product is constant at 2 a unit, complete the table. If the wage rate is 8 an hour, how many workers does the firm hire?
 
  What will be an ideal response?

Question 2

Are the curves in the figure above drawn CORRECTLY? If not, what's wrong?
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

ultraflyy23

  • Sr. Member
  • ****
  • Posts: 312
Reply #1 on: Jun 29, 2018
Answer to Question 1

Quantity of labor
(workers) Marginal product
(units per hour) Value of marginal product
(dollars)
1 10 20
2 8 16
3 6 12
4 4 8

If the wage rate is 8 an hour, the firm hires 4 workers because that is the quantity that sets the value of marginal product equal to the wage rate.

Answer to Question 2

The curves are not drawn correctly. First, the marginal cost curve must intersect the average variable cost curve and the average total cost curve where they are at their minimums, which is not the case in the figure. Second, the vertical distance between the ATC curve and the AVC curve is the AFC, which decreases as output increases. So the vertical distance between the ATC curve and the AVC curve should shrink in size, which is not the case in the figure.


joblessjake

  • Member
  • Posts: 555
Reply 2 on: Jun 29, 2018
Thanks for the timely response, appreciate it

  • Member
  • Posts:
Reply 3 on: Yesterday
:D TYSM

« previous next »
 

Did you know?

Never take aspirin without food because it is likely to irritate your stomach. Never give aspirin to children under age 12. Overdoses of aspirin have the potential to cause deafness.

Did you know?

Asthma occurs in one in 11 children and in one in 12 adults. African Americans and Latinos have a higher risk for developing asthma than other groups.

Did you know?

Coca-Cola originally used coca leaves and caffeine from the African kola nut. It was advertised as a therapeutic agent and "pickerupper." Eventually, its formulation was changed, and the coca leaves were removed because of the effects of regulation on cocaine-related products.

Did you know?

Before a vaccine is licensed in the USA, the Food and Drug Administration (FDA) reviews it for safety and effectiveness. The CDC then reviews all studies again, as well as the American Academy of Pediatrics and the American Academy of Family Physicians. Every lot of vaccine is tested before administration to the public, and the FDA regularly inspects vaccine manufacturers' facilities.

Did you know?

Children of people with alcoholism are more inclined to drink alcohol or use hard drugs. In fact, they are 400 times more likely to use hard drugs than those who do not have a family history of alcohol addiction.

At breakfast, a middle-class husband sits absorbed in the newspaper and the public affairs of the da At breakfast, a middle-class husband sits absorbed in the newspaper and the public affairs of the da
The human eye, a product of 600 million years of evolution (Lamb, Collin, & Pugh, 2007). The human eye, a product of 600 million years of evolution (Lamb, Collin, & Pugh, 2007).
Product & Process Influences - Sterile Products Product & Process Influences - Sterile Products
A Production Function with Diminishing Marginal Product of Capital A Production Function with Diminishing Marginal Product of Capital
ANOVA Table ANOVA Table
GloFish, marketed as the world’s first GM pet, are a controversial product of genetic engineering GloFish, marketed as the world’s first GM pet, are a controversial product of genetic engineering
Video: Cellular Respiration & Glucose Mobilization (Glucose transport & Phosphorylation of Glucose)

For a complete list of videos, visit our video library