Below is productivity data for firm Nearly Done Inc. which purchases resources i
ID: 1219573 • Letter: B
Question
Below is productivity data for firm Nearly Done Inc. which purchases resources in a perfectly competitive factor market.
1.Refer to the above information what quantity of labour will Nearly Done Inc. employ if the market wage rate is $8? .
2. What is NearlyDone's total revenue if the market wage rate is $8.
3. What is NearlyDone's total wage bill if the market wage rate is $8?
4. At its optimal output, what is NearlyDone's total profit or loss if the market wage rate is $8, total fixed costs are $24 and labour costs are the only variable costs?
5. Suppose that the market wage rate is $8, how much morelabour will Nearly Done Inc. employ if the marginal product of labour doubles?
6. In what type of market does Nearly Done Inc. sell its output/product?
7. What quantity of labour will Nearly Done Inc. employ and what will its total revenue be if the market wage rate is $4?
Quantity of TP MPL Unit Price of Product S 10 18 28 36 42 46 48 49 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 2.00 10Explanation / Answer
1. answer is 3 . as then total cost(3*8= 24) is less than total revenue 18*2= 36
2. total revenue is - 2*18= 36
3. total wage bill- 3* 8= 24
4. at 4 labour total cost= 56(24+32) and total revenue is 56(28*2) so no profit and no loss.
6. Price is fixed and uniform so ts a perfect market.
7.9
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