« previous next »

Author Question: Refer to Table 8-27. What is the level of personal income for this economy? A) 1,140 billion B) ... (Read 62 times)

ETearle

  • Hero Member
  • *****
  • Posts: 580
on: Jun 29, 2018
Refer to Table 8-27. What is the level of personal income for this economy?
 
  A) 1,140 billion B) 1,010 billion C) 990 billion D) 860 billion

Question 2

Alan's Roast House sells roasted peanuts in a competitive market. The firm employs labor ata wage rate of 6 per hour and rents capital for 15 per hour.
 
  At its current level of labor and capital, the marginal product of labor is 12 and the marginal product of capital is 40 . Is the firm currently maximizing profit? Explain.


Perkypinki

  • Sr. Member
  • ****
  • Posts: 339
Reply #1 on: Jun 29, 2018
Answer to Question 1

B

Answer to Question 2

No, the firm is not currently maximizing profit. The firm should hire labor and capital such that MPL/PL is equal to MPK/PK. In this case, MPL/PL (2) is less than MPK/PK (2.67). Thus, the firm should hire less labor (which would raise MPL) and more capital (which would lower MPK).


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Atropine, along with scopolamine and hyoscyamine, is found in the Datura stramonium plant, which gives hallucinogenic effects and is also known as locoweed.

Did you know?

The shortest mature adult human of whom there is independent evidence was Gul Mohammed in India. In 1990, he was measured in New Delhi and stood 22.5 inches tall.

Did you know?

It is important to read food labels and choose foods with low cholesterol and saturated trans fat. You should limit saturated fat to no higher than 6% of daily calories.

Did you know?

More than 20 million Americans cite use of marijuana within the past 30 days, according to the National Survey on Drug Use and Health (NSDUH). More than 8 million admit to using it almost every day.

Did you know?

When blood is deoxygenated and flowing back to the heart through the veins, it is dark reddish-blue in color. Blood in the arteries that is oxygenated and flowing out to the body is bright red. Whereas arterial blood comes out in spurts, venous blood flows.

Variation in the level of multicellularity among volvocine algae Variation in the level of multicellularity among volvocine algae
This chart illustrates the four quadrants in which we can place the relationships between the state This chart illustrates the four quadrants in which we can place the relationships between the state
Umberto Boccioni, Table + Bottle + House. Umberto Boccioni, Table + Bottle + House.
Upper-Level Maps Upper-Level Maps
Coolest Period Table EVER Coolest Period Table EVER
Table salt (NaCl) molecules dissolving in water, resulting in Na+ and Cl– ions surrounded by ... Table salt (NaCl) molecules dissolving in water, resulting in Na+ and Cl– ions surrounded by ...
Video: Digestion Animation

For a complete list of videos, visit our video library