If the MPP of labor is 60 and the price of labor per period is $20, the MPP of m
ID: 1101983 • Letter: I
Question
If the MPP of labor is 60 and the price of labor per period is $20, the MPP of machinery is 75 and the price of the machinery per period is $25, in order to achieve optimal input proportions the firm should use
a.
more labor and less machinery.
b.
more machinery and less labor.
c.
more labor with the same amount of machinery.
d.
the current combination.
Suppose a certain firm is able to produce 165 units of output per day when 15 workers are hired. The firm is able to produce 176 units of output per day when 16 workers are hired (holding other inputs fixed). Then the marginal product of the 16th worker is
a.
10 units of output.
b.
11 units of output.
c.
16 units of output.
d.
176 units of output.
Please provide with step by step solutions for points..thanks!
a.
more labor and less machinery.
b.
more machinery and less labor.
c.
more labor with the same amount of machinery.
d.
the current combination.
Explanation / Answer
d.
the current combination.
b.
11 units of output.
d.
the current combination.
b.
11 units of output.
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