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Suppose labour is available to a firm a at a cost of $15 per hour. Also, suppose that employing another hour of labour adds 3
Suppose labour is available to a firm a at a cost of $15 per hour. Also, suppose that employing another hour of labour adds 3 units to output, and any amount of output can be sold for $5 per unit.
- To the nearest dollar, each additional hour of labour will add how much additional revenue to the firm? Answer should be a whole number
- The firm should hire :
the (same labour )or (more/less) or more
3. Instead suppose that the last hour of labour hired by the firm has a marginal product of 4 units of output, now the marginal revenue product of labor is How much?, and in this case, the firm can increase its profits by hiring (less), (more/less), more
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