Clearing one acre brings in $1,000 in revenue.
Suppose that low-skilled workers employed in clearing woodland can each clear one acre per month if each is equipped with a shovel, a machete, and a chainsaw. Comparing your answers to parts c and d, does regulating a monopoly's output price always increase its demand for resources? If the daily wage paid to workers falls to $77 per day, how many workers will the regulated monopoly demand?Į. If the daily wage paid to workers falls to $77 per day, how many workers will the unregulated monopoly demand? Looking at those figures, will the regulated or the unregulated monopoly demand more workers at that wage?ĭ. If the daily wage paid to workers is $170 per day, how many workers will the regulated monopoly demand? If the daily wage paid to workers is $170 per day, how many workers will the unregulated monopoly demand? At that price, what is the firm's MRP for each of the first five workers?Ĭ. Suppose that the monopolist is subjected to rate regulation and the regulator stipulates that it must charge exactly $40 per unit for all units sold. What is the firm's MRP for each of the first five workers?ī. Further suppose that the first worker hired produces 5 units per day, the second 4 units per day, the third 3 units per day, and so on.Ī. if Mason produces both goods and Chloe produces nothing.Suppose that a monopoly firm finds that its MR is $50 for the first unit sold each day, $49 for the second unit sold each day, $48 for the third unit sold each day, and so on.
if each good is produced by the individual who has the higher absolute cost of producing that good if Chloe produces both goods and Mason produces nothing. According to the principle of comparative advantage, the total output produced by these individuals will be greatest if each good is produced by the individual who has the lower opportunity cost of producing that good. Which country has the highest per capita health care expenditures in the world? Canada Japan United States France Mason and Chloe each produce two goods. the marginal physical product curve for Labor divided by the price of the good. the marginal revenue product curve for labor. the marginal physical product curve for labor multiplied by the price of labor. The firms demand curve for labor is the demand curve for the good produced divided by the price of the good. more waiters have to be paid the prevailing wage rate. the supply of labor is perfectly elastic. when new workers are hired the wage, rate must be increased for all workers and not just for the additional workers. For a monopolies, marginal factor cost exceeds the wage rate since the labor demand is downward sloping. Which of the following will lead to an outward shift in the firm's short-run demand for labor? a decline in labor productivity less capital per unit of labor an increase in the prior of output a reduction in average consumer income All of the following are income in kind EXCEPT government provided housing. there would be little or no incentive for individuals to take risky, hazardous, or unpleasant jobs.
productivity levels would probably become too high. too many individuals would want to take risky jobs. If income were distributed according to the egalitarian principle of "to each exactly the same, " then one problem would be that individuals would have an excess desire to invent in their own human capital. the extra cost from hiring the last worker equals the cost of the product. the additional cost at hiring the last worker equals the marginal factor cost of the worker. the extra revenue from hiring the last worker equals the marginal physical product of labor. Transcribed image text: A profit-maximizing firm will hire additional units of labor until the additional cost of hiring the last worker equals the additional revenue generated by that worker.
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