katiki.docxES2550: Week10 Finding the Optimal Amount of Labor
Consider the values in the following table for Terrell’s Televisions
A. Fill in the formula for MP, MRP, and Additional Profit at the top of the column in the gray sections within the table.
B. Fill in the missing values for MP, MRP, and Additional Profit in the blue sections of the table.
|
Terrell's Televisions |
||||||
|
Number of Workers |
Output of Televisions per Week |
Marginal Product of Labor (MP) |
Product Price |
Marginal Revenue Product of Labor (MRP) |
Wage (Dollars Per Week) |
Additional Profit from Hiring One More Worker |
|
0 |
0 |
|
$300 |
|
$1,800 |
|
|
1 |
8 |
|
300 |
|
1,800 |
|
|
2 |
15 |
|
300 |
|
1,800 |
|
|
3 |
21 |
|
300 |
|
1,800 |
|
|
4 |
26 |
|
300 |
|
1,800 |
|
|
5 |
30 |
|
300 |
|
1,800 |
|
|
6 |
33 |
|
300 |
|
1,800 |
|
C. Identify the profit-maximizing quantity of labor. Explain how you arrived at your answer.
D. Is this firm a price taker or a price maker? Explain.
Submission Requirements:
· Formulas must be shown along with the final correct answer.
· Attach a Word document of 150 to 250 words that contains all answers.
· Format: Double line space, Times New Roman, 12-point font
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