Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Microeconomics Expert

problem1. Agree or Disagree. describe your position with one or two sentences. Use a diagram if necessary.

(a): In the short-run, a firm facing competitive input and output markets should shut down if the market wage is greater than the MRPN. Assume that labour is the only variable input.

(b): A firm’s response to a wage change will be greater in the long-run than in the short-run.

(c): Inelastic demand curves are steeper than elastic ones.

(d): Scale and substitution effects always go in the opposite direction.

(e): When a firm’s output market is very price-elastic, derived demand for labour will be very price-inelastic.

(f): Labour’s share in the total costs of a ?rm has no impact on the elasticity of demand.

(g): Canada will not gain from trade because Canada is already on its PPF.

problem2. Suppose there are a large number of identical Canadian firms producing hockey pucks according to the production function: Q = 3. L 2/3 where Q is the number of pucks produced and L is the number of hours of labour.
Therefore, the marginal product of labour is given by

MPN = 2. 1/L1/3 

The price of hockey pucks is p.

(a) Solve for the demand function assuming p = 10

(b) find out the labour demand, output, and profits for wages equal to the following (fill in table) and still assuming p = 10. How do profits vary along the demand curve?1

Table 1: Table for problem 2, part b

Wage ($) Labour   Output   profits
1
2
5
10

(c) Suppose the wage of Canadian puck workers is w = 5. But now a Swedish firm can make pucks for less by having consumers assemble them at home. The Swedish firm competes with the Canadian firms in a world market for pucks. Suppose that now the world price falls from p0 = 10 to p1 = 8. If nothing else changes, what happens to the amount of labour Canadian firms wish to use?

(d) Don Cherry, still bitter about Swedish gold at the 2006 Olympic Games, does not want to be outdone by the Swedes again. He lobbies the Canadian government to subsidize the research and development of puck manufacturing. The production process is now:

Q = 6   L2/3

And the marginal product of labour is

MPN = 4.  1/L11/3

Ignore the shutdown decision. Show that, at any given p, Canadian firms producing with (3) instead of (1) will now demand more labour when w = 5.

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M91233

Have any Question? 


Related Questions in Microeconomics

Feeding america final milestonein this assignment you will

Feeding America Final milestone In this assignment, you will demonstrate your mastery of the following course outcomes: - Evaluate management strategies and organizational structures of not-for-profit organizations for t ...

Assignment voluntourism-go to httpwwwvoluntourismorgreview

Assignment: VolunTourism- Go to http://www.voluntourism.org Review the home page to understand the resources available on this web site and to get a feeling for what VolunTourism is.On the menu (left screen) under "Who A ...

Assignmentin the article at the beginning of the readings

Assignment In the article at the beginning of the readings book, Aronson talks about Social Psychology as a leap of faith, and about the imperfect nature of social psychological experiments (which is true of science in a ...

Assignment maximizing profits and minimizing lossesconsider

Assignment: Maximizing Profits and Minimizing Losses Consider a supplier of agricultural equipment who is deciding how much of two products should be produced by his firm. You determine what the two products are. Now cre ...

Watch the video on the link belowthen answer the following

Watch the video on the link below. Then answer the following questions: 1. Would the incentives discussed in the video be able to work in a college setting? Why or why not? 2. Have you ever changed your behavior because ...

Assignmentoverviewthe incidence of fraud in the news has

Assignment Overview The incidence of fraud in the news has become more common in recent years. As the accounting profession becomes more aware of fraud schemes, it seems that the criminals who perpetrate them have become ...

Assignmentteamworkhow does effective teamwork look how is

Assignment Teamwork How does effective teamwork look? How is teamwork displayed in your life as it relates to your current role? Why is teamwork a necessity for organizations? Does this help or hurt an organization if te ...

Application evaluation of research resultsno research

Application: Evaluation of Research Results No research project or study is perfect. Studies that contain errors can produce unreliable or misleading results. As a consumer of research, you must be able to determine the ...

Assignmentvirtually all general managers face

Assignment Virtually all general managers face capital-budgeting decisions in the course of their careers. The most common of these is the simple "yes" versus "no" choice about a capital investment. Regardless of the typ ...

Project-listen to this video asafter you work on your graph

Project- Listen to this video as/after you work on your graph. The lecture is on the 'Aftermath of the Financial Crisis' given by Ben Bernanke in March 29 th 2012. https://www.c-span.org/video/?305198-1/ben-bernanke-lect ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro