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Homework answers / question archive / Fill out the rest of the table from the given information
Fill out the rest of the table from the given information. Recall that MP = Marginal Product, MRP = Marginal Revenue Product, and TR = Total Revenue.
| Labor | Output | MP | MRP | TR |
|---|---|---|---|---|
| 0 | 0 | 0 | 0 | 0 |
| 1 | 80 | 80 | 320 | 320 |
| 2 | 140 | 60 | 240 | 560 |
| 3 | 185 | 45 | 180 | 740 |
| 4 | 220 | 35 | 140 | 880 |
| 5 | 250 | 30 | 120 | 1,000 |
| 6 | 260 | 10 | 40 | 1,040 |
Having filled out the above table, we now consider the number of workers that will be hired by the profit-maximizing firm. In the table below, fill in Quantity of Labor demanded column. In other words, we are asking the following: How many workers will the firm hire at each wage rate?
| Wage | Quantity of labor demanded |
|---|---|
| 50 | |
| 130 | |
| 150 | |
| 200 | |
| 250 | |
| 300 | |
| 350 |
At each wage rate, the firm will hire workers until the marginal revenue product is below the wage rate. Read down the MRP column in the above table and compare to the wage rate to get this solution:
| Wage | Quantity of labor demanded |
|---|---|
| 50 | 5 |
| 130 | 4 |
| 150 | 3 |
| 200 | 2 |
| 250 | 1 |
| 300 | 0 |
| 350 | 0 |
