Question
(1) (2) (3) (4) (5) L P Q/ L= MPL VMPL= P * MPL W Variable input (labor) Price of output Marginal product of Labor
(1)
(2)
(3)
(4)
(5)
L
P
Q/ L= MPL
VMPL= P * MPL
W
Variable input (labor)
Price of output
Marginal product of Labor (Column 5 of Table 5-1)
Value Marginal Product of Labor
Unit Cost of Labor
Given
Given
(2) * (3)
Given
0
$3
-
-
$400
1
$3
76
$228
$400
2
$3
172
516
$400
3
$3
244
732
$400
4
$3
292
876
$400
5
$3
316
948
$400
6
$3
316
948
$400
7
$3
292
876
$400
8
$3
244
732
$400
9
$3
172
516
$400
10
$3
76
228
$400
11
$3
-44
-132
$400
If the cost to the firm of an additional unit of labor is $400, how units of labor should be hired?
Somewhere between 1 to 2 or 9 to 10 ?
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Fundamentals of Cost Accounting
Authors: William N. Lanen, Shannon Anderson, Michael W Maher
6th edition
1259969479, 1259565408, 978-1259969478
