The firm represented in the table below participates in a perfectly competitive market for their product as well as for labor.Complete the chart and answer the following questions. $\begin{array}{|c|c|c|c|c|c|}
\hline\
\begin{array}{c}
\text { Quantity of } \
\text { Labor }
\end{array} & \begin{array}{c}
\text { Total } \
\text { Output }
\end{array} & \begin{array}{c}
\text { Marginal } \
\text { Product of } \
\text { Labor }
\end{array} & \begin{array}{c}
\text { Product } \
\text { Price }
\end{array} & \begin{array}{c}
\text { Marginal } \
\text { Revenue } \
\text { Product of } \
\text { Labor }
\end{array} & \begin{array}{c}
\text { Wage Rate } \
\text { (MRC) per } \
\text { day }
\end{array} \
\hline 0 & 0 & \cdots & \cdots-- & \cdots \
\hline 1 & 10 & 10 & \$ 10 & 100 & \$ 55 \
\hline 2 & 19 & & \$ & \
\hline 3 & 27 & & \$ & \
\hline 4 & 34 & & \$ & \
\hline 5 & 40 & & \$ & \
\hline 6 & 45 & & \$ & \
\hline 7 & 49 & & \$ & \
\hline 8 & 52 & & \$ & \
\hline
\end{array}$
a. If the firm represented in the table above is currently employing two units of labor, should they hire a third? Why or why not?
b. If the firm represented in the table above is currently employing four units of labor, should they hire a fifth? Why or why not?
c. If the firm represented in the table above is currently employing seven units of labor, should they hire an eighth? Why or why not?
d. At what level of employment will the firm be maximizing profit? If they hire one additional unit of labor, what will be the cost?

Question

The firm represented in the table below participates in a perfectly competitive market for their product as well as for labor.Complete the chart and answer the following questions. $\begin{array}{|c|c|c|c|c|c|}
\hline\
\begin{array}{c}
\text { Quantity of } \
\text { Labor }
\end{array} & \begin{array}{c}
\text { Total } \
\text { Output }
\end{array} & \begin{array}{c}
\text { Marginal } \
\text { Product of } \
\text { Labor }
\end{array} & \begin{array}{c}
\text { Product } \
\text { Price }
\end{array} & \begin{array}{c}
\text { Marginal } \
\text { Revenue } \
\text { Product of } \
\text { Labor }
\end{array} & \begin{array}{c}
\text { Wage Rate } \
\text { (MRC) per } \
\text { day }
\end{array} \
\hline 0 & 0 & \cdots & \cdots-- & \cdots \
\hline 1 & 10 & 10 & \$ 10 & 100 & \$ 55 \
\hline 2 & 19 & & \$ & \
\hline 3 & 27 & & \$ & \
\hline 4 & 34 & & \$ & \
\hline 5 & 40 & & \$ & \
\hline 6 & 45 & & \$ & \
\hline 7 & 49 & & \$ & \
\hline 8 & 52 & & \$ & \
\hline
\end{array}$ 
a. If the firm represented in the table above is currently employing two units of labor, should they hire a third? Why or why not?
b. If the firm represented in the table above is currently employing four units of labor, should they hire a fifth? Why or why not?
c. If the firm represented in the table above is currently employing seven units of labor, should they hire an eighth? Why or why not?
d. At what level of employment will the firm be maximizing profit? If they hire one additional unit of labor, what will be the cost?

Quizplus · Accepted Answer

The Answer of The firm represented in the table below participates in a perfectly competitive market for their product as well as for labor.Complete the chart and answer the following questions. $\begin{array}{|c|c|c|c|c|c|}
\hline\
\begin{array}{c}
\text { Quantity of } \
\text { Labor }
\end{array} & \begin{array}{c}
\text { Total } \
\text { Output }
\end{array} & \begin{array}{c}
\text { Marginal } \
\text { Product of } \
\text { Labor }
\end{array} & \begin{array}{c}
\text { Product } \
\text { Price }
\end{array} & \begin{array}{c}
\text { Marginal } \
\text { Revenue } \
\text { Product of } \
\text { Labor }
\end{array} & \begin{array}{c}
\text { Wage Rate } \
\text { (MRC) per } \
\text { day }
\end{array} \
\hline 0 & 0 & \cdots & \cdots-- & \cdots \
\hline 1 & 10 & 10 & \$ 10 & 100 & \$ 55 \
\hline 2 & 19 & & \$ & \
\hline 3 & 27 & & \$ & \
\hline 4 & 34 & & \$ & \
\hline 5 & 40 & & \$ & \
\hline 6 & 45 & & \$ & \
\hline 7 & 49 & & \$ & \
\hline 8 & 52 & & \$ & \
\hline
\end{array}$ 
a. If the firm represented in the table above is currently employing two units of labor, should they hire a third? Why or why not?
b. If the firm represented in the table above is currently employing four units of labor, should they hire a fifth? Why or why not?
c. If the firm represented in the table above is currently employing seven units of labor, should they hire an eighth? Why or why not?
d. At what level of employment will the firm be maximizing profit? If they hire one additional unit of labor, what will be the cost?

The Firm Represented in the Table Below Participates in a Perfectly