Calculate the missing data, graph the Marginal Revenue Product (MRP) curve, and answer the questions.
Daily Demand for Workers in a Purely Competitive Labor and Product Markets (The workers are price takers).
|
Workers
|
Output
|
MarginalProduct
|
Price
|
Daily Revenue
|
Marginal Revenue Product
|
|
0
|
0
|
0
|
$3.00
|
|
|
|
1
|
20
|
20
|
3.00
|
|
|
|
2
|
39
|
19
|
3.00
|
|
|
|
3
|
57
|
18
|
3.00
|
|
|
|
4
|
74
|
17
|
3.00
|
|
|
|
5
|
90
|
16
|
3.00
|
|
|
|
6
|
105
|
15
|
3.00
|
|
|
|
7
|
119
|
14
|
3.00
|
|
|
|
8
|
132
|
13
|
3.00
|
|
|
1. Which of the two columns in the table above represent the labor demand schedule?
2. What economic law accounts for the decreasing marginal product?
3 If workers are paid $48.00 per day, how many will be hired?
4. How many will be hired at $41 per day?
5. If the demand for the product is cut in half, what will happen to the labor demand curve?
6. How could you calculate the MRP without bothering to calculate total revenue?
7. Matching the MRP = wage, is that an appropriate way to set wages and hiring?
8. What is economic rent? How is it different than profits that we talk about?
9. Illustrate what is the proper role of unions? Why are they declining in membership and influence in the economy?