D I, II, III, and IV 3. In a stable, monopolistically competitive market for res
ID: 1107781 • Letter: D
Question
D I, II, III, and IV 3. In a stable, monopolistically competitive market for restaurants there are: (1 pt., CHOOSE 1) ) zero profits on average, and consumers are indifferent about where they eat. C) zero profits on average, and consumers have preferences about where they eat positive profits on average, and consumers are indifferent about where they eat. D) positive profits on average, and consumers have preferences about where they eat. Chapter 18 4. Table: Sunshine Flower Vase Co. Total Revenue (S) Number of Workers Daily 1,350 1,580 1,760 1.885 1,965 2,015 Use the table above to answer the following questions A) What is the marginal product of labor for the fifth worker? (1 pt.) B) If the market wage for each worker is $100 per day, how many workers will the company hire? (1 pt.) If the market wage for each worker rose from $100 to $210 per day, how many workers would the firm hire? (1 pt.) C) D) If the company hires 7 workers, we know that the market wage must be between and (1 pt.)Explanation / Answer
Marginal product of a labour means the extra units of product produced by hiring one more labour.
4.A. The marginal product of fifth worker is
1760 - 1580 = $180
B. If market wages fot each worker is $100 per day then the company will hire 6 workers as the marginal product of 7th worker is below $100.
C. If market wages fot each worker rose from $100 to $210 per day then the company will hire 4 workers because the marginal product uptill 4 workers is above $210 and from 5th worker it is below $210.
D. If the company hires 7 workers, we know that the wage must be between $50 and $80.
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