Chapter 11, Problem 10PAE

After which administrative assistant do diminishing marginal returns begin for Jose's Tax Office? Explain using numbers. (b) Assume Jose's Tax Office sells its tax advisory services in a perfectly competitive market at a unit price of $4. Calculate the marginal revenue product of the fifth administrative assistant. Show your work. (c) Jose's Tax Office hires administrative assistants in a perfectly competitive labor market for administrative assistants at a wage rate of $90 per hour, and the market price of services remains $4. How many administrative assistants will Jose's Tax Office hire to maximize its profit? Explain using marginal analysis (d) Assume administrative assistants and office software are substitutes in providing tax advisory services by all tax firms in the market. If office software, a fixed input, becomes more expensive and Jose's Tax Office provides the same quantity of tax advisory services, will each of the following increase, decrease, or stay the same? (i) The…

The table below shows the total product for Car Suds, a car wash service. The market for car washes is perfectly competitive and car washes sell for $5 each. The wage rate paid to workers is $50 per day. Fill in the table. How many workers will the firm hire to maximize profits?

At a fast food restaurant, the hourly wage is $9 per worker. The restaurant employs 15 workers per hour, and the marginal product of labour is 3 burgers per hour. The price of a single with cheese, which we pretend is the only thing the restaurant sells, is $3.50. Is the restaurant maximizing profit? If not, would it increase profits by hiring more workers or fewer workers?

Refer to the following table Labor Output Price 0 0   1 16 $7 2 31 $7 3 45 $7 4 58 $7 5 69 $7 6 78 $7 Assume that the labor market is perfectly competitive. Suppose the price of the good is $7. If the wage rate is $65, the firm will achieve maximum profit by hiring ________ workers. Choose correct answer: a. 5   b. 6   c. 4   d. 3

Use the following table, which shows a firm's production, output price, and various quantities of labor (workers) employed, to answer the next question. Workers Total Output per Day Price of Good 2 10 $10 3 15 10 4 19 10 5 22 10 6 24 10 7 25 10 How many workers will the profit-maximizing firm hire if the wage rate is $20 per day? Multiple Choice four three six five