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2 years ago

Suppose that the firm pays its workers $46 per day. Each unit of output sells for $12. How many workers should the firm hire

Business

1 answer:

Korolek [52]2 years ago

8 0

Solution :

A firm hires labor till a point where the cost of hiring is equal to the value of the additional revenue it produces.

We know ,

the wage rate = cos of hiring an additional worker

the value of the additional revenue that the firm produces = price x (MPI) marginal product of the labor.

Therefore, the firm will hire when :

Wage = value of the additional revenue it generates

Thus, wage = price x (MPI) marginal product of the labor ...........(i)

Therefore, given :

wage of a worker = $ 45

Price = $ 12

So, 45 = 12 x MPI

MPI = 3.8

So the marginal product of employing three days of labor = 25-18/4-3 = 7

Marginal product of employing four days of labor = 30-25/4-3 = 5

So the 4th day produces less revenue than the cost that it generates.

So, the firm should hire 3 workers.

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Suppose the nominal GDP is $25 million, the price level is 1.25, and the central bank has set the money supply at $10 million. W

lidiya [134]

Answer:

a) real GDP =$20,000,000

b)velocity of money is 2.50

Explanation:

Nominal GDP is normal spending carried out in terms of dollars.

Nominal GDP is the product of real GDP and price level

Nominal GDP= real GDP*Price level

Given the nominal GDP=$25 million and the price level =1.25 then,

$25000000=real GDP *1.25

$25000000/1.25 = real GDP

$20000000= real GDP

Apply the quantity equation in economics which is;

money supply*velocity of money =price level * real GDP

Given the money supply is=$10,000,000 then,

velocity of money = (price level*real GDP)/money supply

velocity of money = (1.25*20,000,000)/10,000,000

velocity of money =2.50

4 0

3 years ago

Read 2 more answers

List any 5 important of wetland

antiseptic1488 [7]

Answer:

Wetlands are highly productive and biologically diverse systems that enhance water quality, control erosion, maintain stream flows, sequester carbon, and provide a home to at least one third of all threatened and endangered species. ... improve water quality. provide wildlife habitat. maintain ecosystem productivity.

8 0

3 years ago

If Congress ends an investment tax credit that used to subsidize domestic investment, how would this affect the market for loana

marin [14]

Answer: Demand will fall, Interest rates will fall

Explanation:

The investment tax credit would have encouraged more companies to seek loanable funds in order to embark on investment opportunities because they would be taxed less. This increase in demand in the market for loanable funds would have led to rates rising to keep up with demand.

If Congress were to end this credit, the incentive to invest and avoid tax would be gone. Companies would therefore demand less loanable funds and with this drop in demand there will be a drop in interest rates as well to entice people to borrow at the lower rates.

3 0

3 years ago

A firm has adopted a policy whereby it will not seek any additional external financing. Given this, what is the maximum growth r

dlinn [17]

Answer:

Explanation:

Given:

The net income = $12,000

Total equity = $40,000

Total assets = $80,000

Dividend payout ratio = 40%

Now,

Internal rate of return, r = $\frac{\textup{Net Income}}{\textup{Total Equity}}\times100\%$

Internal rate of return, r = $\frac{\textup{12,000}}{\textup{80,000}}\times100\%$

Internal rate of return, r = 15%

and,

Retention ratio = 1 - Dividend payout ratio

= 1 - 0.40

= 0.60 or 60%

Now,

Growth rate = Retention ratio × Internal rate of return

Growth rate = 0.60 × 0.15

Growth rate = 0.09

Growth rate = 9%

7 0

2 years ago

Asa works as an order-taker at Simply Salads, a fast-food restaurant. He does not cook food, or even package the final order, bu

Softa [21]

Answer:

Hierarchical organizational structure

Explanation:

Hierarchical organizational structure is the type of organization structure where the level of management are divided according to function and services they are performing.

though, the level of management is divided into top level management (the planning executives: boards of member, executives, shareholders), middle (determined how the plan and organization goal will be implemented: managers) and lower level (implement the plan: the supervisor, foreman or shift manager), then will have the workers.

this management system involves decision and authority being transfer from level to level.

in the case: Asa is in the worker level, while her shift manager is in the lower level and general manager is in the middle level.

6 0

2 years ago