Answered: (a) Why does the labour demand curve…

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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Transcribed Image Text:Question 3 (a) Why does the labour demand curve slope downwards? (b) A garment factory's production function is provided in the table.The gross profit per unit (difference between selling price and material cost, but not including the cost of labour) is $100. # Workers Output 1 20 36 3 48 4 56 60 62 (i) If the wage rate is $1,000 a week, how many workers should the factory hire? (ii) If a surge in popularity for the factory's brand allows them to raise the product price such that the gross profit rises to $150, how many workers will the factory hire now? (iii) Calculate the number of garments produced in each of the two cases above.

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Hello, thank you for the question. Since there are multiple questions asked here, only the first question will be answered and if you need an answer to other question, please repost the question.

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Demand for labor indicates the number of labors which is hired at a particular wage rate.

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