Microeconomics: Private and Public Choice (MindTap Course List)
15th Edition
ISBN: 9781285453569
Author: James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher: Cengage Learning
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Chapter 2, Problem 2CQ
To determine
Explain the reason for an increase in the wage rate of a painter substantially than their productivity.
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To save money, some fast food chains are now having their customers place their orders at computer kiosks. Will the kiosks necessarily reduce the total number of workers employed in the fast food industry?
As the productivity of labor rises, so will the demand for labor.
True – False: Explain
The Apple Pie Factory produces apple pies. The firm sells its product and hires its workers in competitive markets. The market price (p) for a pie is $5 and the wage rate
(w) is $28 per hour. The table below shows the total hourly production (Q) for varying amounts of workers (L). (Remember that for a price-taking firm, p = MR.)
a-b. Fill in the p and w columns and calculate the MP and the MRP for each amount of labour employed. (Enter your responses rounded to the nearest whole numbers.)
L
8
9
10
11
12
Q
65
72
78
83
87
W
$
$
$
$
$
$
$
$
$
р
MP
MRP ($)
$
$
$
$
Chapter 2 Solutions
Microeconomics: Private and Public Choice (MindTap Course List)
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Similar questions
- Suppose Kara maximizes her profits by hiring workers to produce hand-made soaps. Her soaps sell for $1 each. How should Kara decide on how many workers she should hire? a.Hire workers up to the point when the price of her soaps starts to fall from $1 b.Hire workers up to the point when the total product of all her workers is at its maximum c.Hire up to the point when the wage rate equals to the value of the marginal product of the last worker hired d.Hire up to the point when the marginal product of the last worker hired is equal to zeroarrow_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 demand for labor. You develop a popular video game and continue to develop new versions to keep people interested in the game.arrow_forwardEquilibrium in the labour market depends on the demand for labour and the supply of labour. Graphically demonstrate how the supply of labour in the U.S. is affected by the increase in the labour force resulting from Mexican immigrants. What other factors that can cause the labour supply curve to shift?arrow_forward
- How would each of the following likely affect the real wage and employment of unskilled workers on an automobile plant assembly line? a. Demand for the type of car made by the plant increases. b. A sharp increase in the price of gasoline causes many commuters to switch to public transportation. c. Because of alternative opportunities, people become less willing to do factory work. d. The plant management introduces new assembly-line methods e. Robots are introduced to do most basic assembly-line tasks.arrow_forwardConsider Blewitt's Farm, a small blueberry grower relative to the size of the market whose production has no impact on wages and prices. The following table presents Blewitt's production schedule for blueberries: Labor Output (Number of workers) (Pounds of blueberries) 0 WAGE (Dollars per worker) 300 270 240 210 Suppose that the market wage for blueberry pickers is $200 per worker per day, and the price of blueberries is $13 per pound. 180 On the following graph, use the blue points (circle symbol) to plot Blewitt's labor demand curve when the output price is $13 per pound. Note: Remember to plot each point between the two integers. For example, when the number of workers increases from 0 to 1, the value of the marginal product of for the first worker should be plotted with a horizontal coordinate of 0.5, the value halfway between 0 and 1. Line segments will automatically connect the points. 150 120 60 1 30 2 3 4 0 5 0 20 38 54 68 80 O Demand P = $13 Demand P = $15 (?)arrow_forwardThe following table shows the relationship between the number of workers employed and outputs at Wendy’s Café. Number of Workers Cups of Coffee Produced (per day) 1 50 2 95 3 135 4 170 5 200 6 225 Suppose the market price of each cup of coffee is $20, and the market daily wage for each worker is $800. In order to maximize profit, how many workers should Wendy’s Café employ? Explain and show the steps of your calculations.arrow_forward
- Describe the factors that could cause an increase in the wage rate of workers.arrow_forwardThe government recently imposed a number of regulations on companies that will make it more expensive for companies to hire workers. What consequence will this have on the labor market?arrow_forwardKelsey owns a cotton candy shop that employs 7 people. The employees are paid $12 per hour, and a cotton candy sells for $3. If Kelsey is maximizing her profit (and operating in a perfectly competitive output and perfectly competitive labor market), what is the value of the marginal product of labor of the last worker she hired? What is this worker’s marginal product of labor?arrow_forward
- what are the factors that will lead to an increase in demand for workers in an economy?arrow_forwardHow would I analyze how the equilibrium wage and number of working hours will change when a company has a great demand for workers (i.e. grocery stores now) yet some current workers don't want to work as many hours? How would I explain the three cases that would depend on the relative size of change in labor demand and labor supply? For example. Case 1. Change in supply(∆LS)| = |Change in Demand(∆LD )| . Case 2: |∆LS| > |∆LD| . Case 3: |∆LS| < |∆LD| I'm trying to understand how the equilibrium wage and number of working hours will change under these different scenarios. Thanksarrow_forwardAssume that the information technology and consulting industries employ people with similar skills. Suppose a decrease in the demand for consultants leads to a fall in their wages, while the demand for computer analysts remains the same. The following graph shows the labor market for computer analysts in the United States. Show the effect of the fall in demand for consultants on the U.S. labor market for computer analysts by shifting the labor demand curve, the labor supply curve, or both. WAGE LABOR Supply Demand Demand Supply ?arrow_forward
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