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Suppose that labour is the only input used by a perfectly competitive firm. The firm's production function is as follows: Days of Labor Units of
Suppose that labour is the only input used by a perfectly competitive firm. The firm's production function is as follows: Days of Labor Units of Output 1. 7 2 13 3 19 4 25 5 28 6 29 7 29 a) Calculate the marginal product for each additional worker. (1.5) b) Each unit of output sells for $10. Calculate the value if the marginal product of each worker. (2) c) Compute the demand schedule showing the number of workers hired for all wages from zero to $100 a day. (3) d) Graph the firm's demand curve. (3) e) What happens to this demand curve if the price of output rises from $10 to $12 per unit? Graph the firms demand curve
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