Sunday, August 14, 2011

Economics Aplia?

Suppose you own a firm that sells its output in a perfectly competitive market, and you seek to maximize profit. Given a market wage of $450 per week, you choose not to hire a 10th worker when output price is $12, since the marginal revenue product of a 10th worker is only $360. If the output price rose sufficiently, you would be willing to hire a 10th worker. What is the lowest price for your output at which you would be willing to hire a 10th worker?

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