# of Workers Total Product per Hour 120 2 250 3 370 4 420 460 490 510 8 515 The table shows the short-run production function for Steve's Macaroni Company. 1. With which worker does diminishing returns begin for Steve's Macaroni Company? Explain. 2. Assume Steve's Macaroni Company sells its macaroni in a perfectly competitive market for $7. Calculate the marginal revenue product of the third worker. 3. Steve's Macaroni Company hires workers in a perfectly competitive labor market at a wage of $140 per hour, and the market price of macaroni stays at $7. How many workers will Steve's Macaroni Company hire to maximize its profits? 4. Assume workers have to pay for a certification exam to work at Steve's Macaroni Company. If the cost of the certification exam increases, what will happen to the following in equilibrium? 1. The market wage rate. Explain. 2. The number of workers hired in the labor market