A company operates in a perfectly competitive market, selling each unit of outpu

Question

A company operates in a perfectly competitive market, selling each unit of output for a price of $10 and paying the market wage (marginal resource cost) of $130 per day for each worker it hires. In the following table, complete the column for the marginal revenue product of labor (MRP) at each quantity of workers. Marginal Product of Labor Marginal Revenue Product of Labor Labor output (Number of workers) (Units of output) (Units of output) (Dollars) 17 17 16 33 14 47 12 59 67 On the following graph, u the blue points (circle symbol to plot the firm's labor demand curve. Then, use the orange line (square symbol to se show the wage rate. Line segments will automatically connect the points. Hint: Remember to plot each point halfway between the two integers. For example, when the number of workers increases from 0 to 1, the marginal revenue product for the first worker should be plotted with a horizontal coordinate of 0.5, the value halfway between 0 and 1

Explanation / Answer

worker 3 is the profit maximization point

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