Microeconomics (7th Edition)
7th Edition
ISBN: 9780134737508
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Question
Chapter 17, Problem 17.6.4PA
Subpart (a):
To determine
Calculation of Marginal product of capital, total revenue, marginal revenue product of capital, and the additional profit from renting one more capital.
Subpart (b):
To determine
Calculation of Marginal product of capital, total revenue, marginal revenue product of capital, and the additional profit from renting one more capital.
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Students have asked these similar questions
Q4.
The graph below represents Lisena’s Landscaping Service’s demand for labor in the town of Forest Hills. The price of cutting a standard-sized residential lawn is $50 and the market wage rate for a worker is $200 per day. Answer the questions below.
a. At the current market wage rate how many workers will the firm hire?b. Which economics principle can be used to explain why Lisena should NOT hire a fifth worker?c. What is the minimum number of lawns each worker should cut per day given wage rate of $200? Explain with a calculation.d. What happens to the demand for labor curve if the market price of cutting a lawn increases to $65? Explain your answer.e. What happens to the demand for labor curve if the market wage rate increases from $200 per day to $250 per day? Explain your answer.
suppose Fred produces 500 litres of milk every day with 10 workers. the price of milk is $12 per litre, and each worker is paid $550 daily.
if th margin product of the last worker employed is 40 litres of milk, explain whether Fred is maximizing his profit. If not, can Fred incrase his profit by employing more or fewer workers?
If Fred buys more dairy cattles, how will it affect his demand for labor? Explain with a diagram.
The following table contains the relationship between a number of trainers working at a new gym and the number of clients they can train. These clients represent the output of trainers. Clients pay $40 per session.
Number of Trainers
Clients Trained
1
10
2
50
3
80
4
100
5
110
6
115
a. Find the marginal product of labor (MPL) and the value of the marginal product of labor (VMPL) for each additional trainer hired and record these numbers in columns in the table.
b. Premier trainers earn $200 an hour. How many trainers will the gym hire?
Chapter 17 Solutions
Microeconomics (7th Edition)
Ch. 17 - Prob. 17.1.1RQCh. 17 - Prob. 17.1.2RQCh. 17 - Prob. 17.1.3RQCh. 17 - Prob. 17.1.4RQCh. 17 - Prob. 17.1.5PACh. 17 - Prob. 17.1.6PACh. 17 - Prob. 17.1.7PACh. 17 - Prob. 17.1.8PACh. 17 - Prob. 17.1.9PACh. 17 - Prob. 17.2.1RQ
Ch. 17 - Prob. 17.2.2RQCh. 17 - Prob. 17.2.3PACh. 17 - Prob. 17.2.4PACh. 17 - Prob. 17.2.5PACh. 17 - Prob. 17.2.6PACh. 17 - Prob. 17.2.7PACh. 17 - Prob. 17.2.8PACh. 17 - Prob. 17.3.1RQCh. 17 - Prob. 17.3.2RQCh. 17 - Prob. 17.3.3PACh. 17 - Prob. 17.3.4PACh. 17 - Prob. 17.3.5PACh. 17 - Prob. 17.3.6PACh. 17 - Prob. 17.3.7PACh. 17 - Prob. 17.3.8PACh. 17 - Prob. 17.4.1RQCh. 17 - Prob. 17.4.2RQCh. 17 - Prob. 17.4.3RQCh. 17 - Prob. 17.4.4PACh. 17 - Prob. 17.4.5PACh. 17 - Prob. 17.4.6PACh. 17 - Prob. 17.4.7PACh. 17 - Prob. 17.4.8PACh. 17 - Prob. 17.4.9PACh. 17 - Prob. 17.4.10PACh. 17 - Prob. 17.4.11PACh. 17 - Prob. 17.4.12PACh. 17 - Prob. 17.4.13PACh. 17 - Prob. 17.4.14PACh. 17 - Prob. 17.4.15PACh. 17 - Prob. 17.4.16PACh. 17 - Prob. 17.4.17PACh. 17 - Prob. 17.4.18PACh. 17 - Prob. 17.4.19PACh. 17 - Prob. 17.5.1RQCh. 17 - Prob. 17.5.2RQCh. 17 - Prob. 17.5.3PACh. 17 - Prob. 17.5.4PACh. 17 - Prob. 17.5.5PACh. 17 - Prob. 17.5.6PACh. 17 - Prob. 17.5.7PACh. 17 - Prob. 17.6.1RQCh. 17 - Prob. 17.6.2RQCh. 17 - Prob. 17.6.3RQCh. 17 - Prob. 17.6.4PACh. 17 - Prob. 17.6.5PACh. 17 - Prob. 17.6.6PACh. 17 - The total amount of oil in the earth is not...Ch. 17 - Prob. 17.6.8PACh. 17 - Prob. 17.1CTECh. 17 - Prob. 17.2CTECh. 17 - Prob. 17.3CTE
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- The graph above shows a labor market and a typical individual firm that is hiring labor from that market. (a) If , from what type of labor market does the firm hire its workers?arrow_forwardAre the following statements correct or incorrect? Briefly explain: a. When making the hiring decision, a rational producer should always relay on both the average product of labour and the marginal product of labour.arrow_forwardThe following table contains the relationship between a number of trainers working at a new gym and the number of client's they can train. These client's represent the output of trainers. Client's pay $40 per session. A. Find the marginal product of labor (mpl) and the value of the marginal product of labor (vmpl) for each additional trainer hired and record these numbers in columns in the table. B. Premier trainers earn $200 an hour. How many trainers will the gym hire?arrow_forward
- Suppose that you observe that the wages for accountants in your town have gone up and that thenumber of accountants employed has also gone up. Which one of the following conditions couldexplain this?Illustrate your answer with a graph and explain in a brief paragraph.a. Businesses are failing, reducing the need for accountants.b. Many accountants are leaving the field in order to train to become financial analystsinstead.c. A rash of business scandals has increased the demand for auditing services performed byaccountants.d. The local university has just graduated an unusually large group of accountants.arrow_forwardYou are given a scenario where this a change in a factor of production or a change in demand for an item. You need to explain in sentence form how this would change the demand for labor. See the example and model your answers after how the example is written.arrow_forwardUse a graph to illustrate and explain the individual supply of labour curve. In youranswer, describe the forces that determine the form (shape) of the individualsupply of labour curve.arrow_forward
- Suppose Fred produces 500 litres of milk every day with 10 workers. The price of milk is $12 per litre, and each worker is paid $550 daily. If the marginal product of the last worker employed is 40 litres of milk, explain whether Fred is maximizing his profit. If not, can Fred increase his profit by employing more or fewer workers? If Fred buys more dairy cattles, how will it affect his demand for labor? Explain with a diagram.arrow_forwardThe top graph below shows David’s preferences for leisure and consumption. In the bottom graph, "Supply of Labor," draw David’s Labor Supply curve based on your answers from the top graph.arrow_forwardBriefly explain the marginal productivity theory of wages.arrow_forward
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