The Zippy Paper Company has no control over either the price of paper or the wage it pays its workers. The following table shows the relationship between the number of workers Zippy hires and total output, with all other inputs being held constant. In the following table, for each quantity of labor input, fill in the marginal product (MP) and marginal revenue product (MRP) for Zippy. (Note: When the price doubles, this will also double the marginal revenue product.) Labor Input Total Output Marginal Product Marginal Revenue Product (Workers per day) (Boxes of paper per day) (Boxes of paper per day) Price = $10 Price = $20 (Dollars) (Dollars) 0 0 1 25 2 45 3 60 4 70 5 75 6 77 Assume that the selling price of paper is $10 per box. If the wage rate is $125.00 per day, Zippy will hire ______workers. Continue to assume that the selling price of paper is $10 per box. If the wage rate is $75.00 per day, Zippy will hire ________workers. Assume that the selling price of paper is now $20 per box. If the wage rate remains at $75.00 per day, Zippy will hire ________workers.
The Zippy Paper Company has no control over either the price of paper or the wage it pays its workers. The following table shows the relationship between the number of workers Zippy hires and total output, with all other inputs being held constant. In the following table, for each quantity of labor input, fill in the marginal product (MP) and marginal revenue product (MRP) for Zippy. (Note: When the price doubles, this will also double the marginal revenue product.) Labor Input Total Output Marginal Product Marginal Revenue Product (Workers per day) (Boxes of paper per day) (Boxes of paper per day) Price = $10 Price = $20 (Dollars) (Dollars) 0 0 1 25 2 45 3 60 4 70 5 75 6 77 Assume that the selling price of paper is $10 per box. If the wage rate is $125.00 per day, Zippy will hire ______workers. Continue to assume that the selling price of paper is $10 per box. If the wage rate is $75.00 per day, Zippy will hire ________workers. Assume that the selling price of paper is now $20 per box. If the wage rate remains at $75.00 per day, Zippy will hire ________workers.
Chapter7: Production And Cost In The Firm
Section: Chapter Questions
Problem 3.7P
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Question
The Zippy Paper Company has no control over either the price of paper or the wage it pays its workers. The following table shows the relationship between the number of workers Zippy hires and total output, with all other inputs being held constant.
In the following table, for each quantity of labor input, fill in the marginal product (MP) and marginal revenue product (MRP) for Zippy. (Note: When the price doubles, this will also double the marginal revenue product.)
Labor Input
|
Total Output
|
Marginal Product
|
Marginal Revenue Product
|
|
---|---|---|---|---|
(Workers per day)
|
(Boxes of paper per day)
|
(Boxes of paper per day)
|
Price = $10
|
Price = $20
|
(Dollars)
|
(Dollars)
|
|||
0 | 0 | |||
|
|
|
||
1 | 25 | |||
|
|
|
||
2 | 45 | |||
|
|
|
||
3 | 60 | |||
|
|
|
||
4 | 70 | |||
|
|
|
||
5 | 75 | |||
|
|
|
||
6 | 77 | |||
Assume that the selling price of paper is $10 per box.
If the wage rate is $125.00 per day, Zippy will hire ______workers.
Continue to assume that the selling price of paper is $10 per box.
If the wage rate is $75.00 per day, Zippy will hire ________workers.
Assume that the selling price of paper is now $20 per box.
If the wage rate remains at $75.00 per day, Zippy will hire ________workers.
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