Labor input (workers per hour) (bears/hour) ($/bear) Total Product Price 0 0 19
ID: 1117253 • Letter: L
Question
Labor input (workers per hour) (bears/hour) ($/bear) Total Product Price 0 0 19 36 51 62 72 79 84 2 4 Question 43: Suppose that the Fuzzy Wuzzy Wuzza Company has the production function above for producing stuffed bears. If the company wants to maximize profit, what is the maximumamount that the firm should pay the 7th worker per hour? C 1) $84.00 2) S252.00 C 3) S15.00 C 4) S3.00 Question 44: Suppose that the Fuzzy Wuzzy Wuzza Company has the production function above for producing stuffed bears. What is the value of the marginal product of the 4th worker? C 1 $11 per hour 2) $186 per hour 3) 62 bears per hour 4) $33 per hour C Question 45: Suppose that the Fuzzy Wuzzy Wuzza Company has the production function above for producing stuffed bears. If the market wage is $32.50 per hour, how many workers should Fuzzy Wuzzy Wuzza hire per hour in order to maximize its profits? C 1 2 workers C 2) 3 workers 3) 4 workers C 4) 5 workersExplanation / Answer
VMPL = MPL x P
MPL (nth unit) = TP (n units) - TP ((n-1) units)
43) option 3 is correct (wage rate = VMPL for profit maximization)
44) option 4 is correct
45) option 3 is correct ( the company must employ workers upto a level where VMPL > = wage rate)
L TP P MPL VMPL 0 0 3 1 19 3 19 57 2 36 3 17 51 3 51 3 15 45 4 62 3 11 33 5 72 3 10 30 6 79 3 7 21 7 84 3 5 15Related Questions
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