ECN200 Grantham Microeconomics Labor and Wages Questions
Labor and Wages
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The following chart provides information on |
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a firm that hires labor competitively and sells |
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its product in a competitive market. |
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Units of Labor |
Total Output |
Product Price |
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1 |
14 |
$5 |
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2 |
26 |
$5 |
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3 |
37 |
$5 |
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4 |
46 |
$5 |
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5 |
53 |
$5 |
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6 |
58 |
$5 |
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a.How many units of labor would be employed if the market wage rate were $40? Why?
b.What would happen to employment if the wage rate rose to $50? Explain your answer.