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ANSWER E.) AND F.) ANSWER E.) AND F.)
I. Suppose that you own a car wash and that its production function is Q--0.8+4.5L-0.3L2 where Q is the number of cars washed per hour and L is the number of persons employed. Assume the input and product markets are perfectly competitive and labor is the only input. Suppose that you receive $5 for each car washed and that the wage rate for each person you employ is $4.50. a) How many people should you employ to maximize profit? b) What will your hourly profit amount to? c) How many people will you employ if the wage rate is $1.50? d) How many if it is $7.50? e) Based on these results, draw these points on your firm's demand curve for labor. In general, graph the situation if you were a monopsonist. Describe the differences in the equilibrium wage and quantity of labor employed f)
ANSWER E.) AND F.) ANSWER E.) AND F.)
I. Suppose that you own a car wash and that its production function is Q--0.8+4.5L-0.3L2 where Q is the number of cars washed per hour and L is the number of persons employed. Assume the input and product markets are perfectly competitive and labor is the only input. Suppose that you receive $5 for each car washed and that the wage rate for each person you employ is $4.50. a) How many people should you employ to maximize profit? b) What will your hourly profit amount to? c) How many people will you employ if the wage rate is $1.50? d) How many if it is $7.50? e) Based on these results, draw these points on your firm's demand curve for labor. In general, graph the situation if you were a monopsonist. Describe the differences in the equilibrium wage and quantity of labor employed f)
coursetLv10
23 Sep 2022
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mahayodha80Lv10
7 Aug 2022
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