4. At Tuxi's, tacos cost $2.50 (p=2.5) and the market wage for labor is $12.50. a. Calculate the marginal product of labor (MPE), average product of labor (APE), value of the marginal product of labor (MRPE), and value of the average product of labor (VAPE) in the chart below. Number of Tacos workers 1 15 28 3 38 4 47 5 54 6. 59 7 62 8 64 65 b. What's the optimal amount of labor to use? c. What would be the per-hour profits at Tuxi's if capital costs $50 per hour?

Microeconomics: Principles & Policy
14th Edition
ISBN:9781337794992
Author:William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:William J. Baumol, Alan S. Blinder, John L. Solow
Chapter19: Labor And Entrepreneurship: The Human Inputs
Section: Chapter Questions
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4. At Tuxi's, tacos cost $2.50 (p=2.5) and the market wage for labor is $12.50.
a. Calculate the marginal product of labor (MPE), average product of labor
(APE), value of the marginal product of labor (MRPE), and value of the
average product of labor (VAPE) in the chart below.
Number of Tacos
workers
1
15
2
28
3
38
4
47
5
54
6.
59
7
62
8
64
65
b. What's the optimal amount of labor to use?
c. What would be the per-hour profits at Tuxi's if capital costs $50 per hour?
Transcribed Image Text:4. At Tuxi's, tacos cost $2.50 (p=2.5) and the market wage for labor is $12.50. a. Calculate the marginal product of labor (MPE), average product of labor (APE), value of the marginal product of labor (MRPE), and value of the average product of labor (VAPE) in the chart below. Number of Tacos workers 1 15 2 28 3 38 4 47 5 54 6. 59 7 62 8 64 65 b. What's the optimal amount of labor to use? c. What would be the per-hour profits at Tuxi's if capital costs $50 per hour?
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