Exploring Microeconomics
8th Edition
ISBN: 9781544339443
Author: Sexton, Robert L.
Publisher: Sage Publications, Inc., Corwin, Cq Press,
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Chapter 16, Problem 11P
To determine
To explain:
The impact on the engineering and poetry programs at the MS University.
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According to The Wall Street Journal, Mitsubishi Motors recently announced a major restructuring plan in an attempt to reverse declining global sales. Suppose that as part of the restructuring plan Mitsubishi conducts an analysis of how labor and capital are used in its production process. Prior to restructuring Mitsubishi’s marginal rate of technical substitution is 0.12 (in absolute value). To hire workers, suppose that Mitsubishi must pay the competitive hourly wage of ¥1,800. In the study of its production process and markets where capital is procured, suppose that Mitsubishi determines that its marginal productivity of capital is 0.8 small cars per hour at its new targeted level of output and that capital is procured in a highly competitive market. The same study indicates that the average selling price of Mitsubishi’s smallest car is ¥1,200,000. Determine the rate at which Mitsubishi can rent capital and the marginal productivity of labor at its new targeted level of output. To…
According to the Wall Street Journal, Mitsubishi Motors recently announced a major restructuring plan in an attempt to reverse declining global sales. Suppose that as part of the restructuring planMitsubishi conducts an analysis of how labour and capital are used in its production process. Prior to restructuring Mitsubishi’s marginal rate of technical substitution is 0.15 ( in absolute value). To hire workers. Suppose that Mitsubishi must pay the competitive hourly wage of US$ 15. In thestudy of production process and markets where capital is procured, suppose that Mitsubishi determine that its marginal productivity of capital is 0.5 small cars per hour at its new targeted level of output and that capital is procured in a highly competitive market. The same study indicates that the average selling price of Mitsubishi’s smallest car is US$ 9500. Determine the rate at which Mitsubishi can rent capital and marginal productivity of labour at its new targeted level of output. To minimize…
Suppose that in a competitive output market, firms hire labor from a competitive labor market (so that the profit maximization conditions for hiring labor are as we discussed in class). If the demand for the product these firms sell increases, so that the market price of this product increases, we would expect which of the following regarding the equilibrium wage, W, and the equilibrium quantity of labor, L, employed?
Group of answer choices
a) a decrease in W and no change in L
b) a decrease in W and a decrease L
c) an increase in W and a decrease L
d) a decrease in W and an increase L
e) an increase in, W, and an increase in L
Chapter 16 Solutions
Exploring Microeconomics
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- Q33 In order to maximize profits, a firm needs to determine the quantity of each factor that it will employ, which is dictated by price as well as productivity of the factor. Assume farmer in the Ottawa area named Justin Trudeau has fixed amounts of land and capital and finds that total product is 24 for the first worker hired, 32 when two workers are hired, 37 when three are hired, and 40 when four are hired. Justin Trudeau product sells for $3 per unit, and the wage rate is $13 per worker. The marginal product of the second worker is Multiple Choice 32 14. 8 1 5arrow_forwardSuppose the demand for the Vietnamese inexpensive products from many countries over the world have increased by about 15 percent even under the Coronavirus pandemic in 2020 (from January through August). Suppose further that the demand for Vietnamese skilled workers by the Vietnamese companies producing new high-tech and advanced products have decreased by about 10 percent in 2020 compared to those in 2019. What has happened to the wage gap between Vietnamese skilled and unskilled workers in 2020? Which of the following is MOST appropriate for an answer? A. The wage gap is most likely to fall. B. It is hard to predict unambiguously how the wage gap changes given above information. C. The wage gap is most likely to rise. D. The wage gap is most likely to be little changed. Perhaps b and c weren't the answer. Please let me know why the answer you chose is correct.arrow_forwardQ60 Firms need to decide the proportion of various inputs they will employ in producing their output in order to either minimize cost or maximize profit. Assume that the maker of Samsung appliances is employing variable resources Capital (X) and Labour (Y) in such amounts that the MRPs of the last units of X and Y employed are $100 and $60, respectively. Resource X can be hired at $50 per unit and resource Y at $80 per unit. The firm Multiple Choice shut down. should hire more of both X and Y. is using the least-costly combination of X and Y but could increase its profits by employing less of both X and Y. should hire more of X and less of Y. is producing with the least-costly combination of X and Y but could increase its profits by employing more of X and less of Y.arrow_forward
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