The above table shows the total product schedule for Hair Today, ...

[kodithompson]

The above table shows the total product schedule for Hair Today, a hair styling salon.
 
  a) What is the first worker's marginal product? The second worker? The third worker? The fourth worker? The fifth worker? b) Over what range of workers is there increasing marginal returns? Over what range is there decreasing marginal returns?

Question 2

Explain why a monopsony's marginal cost of labor is greater than the wage rate.
 
  What will be an ideal response?

[flannelavenger]

Answer to Question 1

a) The first worker's marginal product is 10 hair stylings. The second worker's marginal product is 15 hair stylings. The third worker's marginal product is 20 hair stylings. The fourth worker's marginal product is 15 hair stylings. The fifth worker's marginal product is 10 hair stylings.
b) There are increasing marginal returns for the first 3 workers. After the third worker, there are decreasing marginal returns.

Answer to Question 2

If the monopsony wants to hire more labor, it must offer a higher wage to the additional worker PLUS it must offer that same higher wage to all workers that were previously hired at a lower wage.

[kodithompson]

Excellent

[chjcharjto14]

TYSM