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 shown in the table below. Assume the product price is $5. a. Calculate the marginal revenue product and the marginal resource cost, and then fill in the blanks in the labor supply table. Instructions: Enter your answers as a whole number. Units of Labor Marginal Product Marginal Revenue Product Total Product Total Labor Cost Marginal Resource Wage Rate 47 (Labor) Cost 10 400 $9 $90 11 418 18 90 12 132 12 434 16 80 15 180 13 448 14 70 18 234 14 460 12 60 21 294 15 470 10 50 24 360 b. What are the equilibrium wage rate and level of employment? Equilibrium wage rate = $ Equilibrium level of employment = workers

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 shown in the table below. Assume the product price is $5. a. Calculate the marginal revenue product and the marginal resource cost, and then fill in the blanks in the labor supply table. Instructions: Enter your answers as a whole number. Units of Labor Marginal Product Marginal Revenue Product Total Product Total Labor Cost Marginal Resource Wage Rate 47 (Labor) Cost 10 400 $9 $90 11 418 18 90 12 132 12 434 16 80 15 180 13 448 14 70 18 234 14 460 12 60 21 294 15 470 10 50 24 360 b. What are the equilibrium wage rate and level of employment? Equilibrium wage rate = $ Equilibrium level of employment = workers

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter11: The Firm: Production And Costs

Section: Chapter Questions

Problem 15P

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