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3 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]3 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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Answer:

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Explanation:

These are the options for the question below;

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3 years ago

When the macroeconomy is experiencing a higher than natural rate of unemployment, it must be because

Alona [7]

Answer:

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Explanation:

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Answer:

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3 years ago

Read 2 more answers

On November 1, Year 1, Black Lion Company forecasts the purchase of raw materials from an Argentinian supplier on February 1, Ye

Alchen [17]

Answer:

Option B: 70,900 decrease in net income

Explanation:

Net impact on black lion company's year 2 net income as a result of this hedge of a forecast foreign currency purchase can be calculated by summing up the Option expense, cost of goods sold and adjustment to net income in year 2 .

NET IMPACT ON YEAR NET INCOME

Option expenses (900)

Cost of goods sold (72,000)

Adjustment to Net Income 2000

Decrease in Net Income (70,900)

Working

DEBIT CREDIT

Option expense 900

Foreign currency Option 1100

(0.35 - 0.36) x 200,000 = 2000

2000 - 900 = 1100

Accumulated other comprehensive income 2000

DEBIT CREDIT

Foreign currency 72,000

(200,000x0.36)

Cash 70,000

(200,000x0.35)

Foreign currency option 2,000

DEBIT CREDIT

Cost of goods sold 72,000

Foreign currency 72,000

DEBIT CREDIT

Accumulated other comprehensive income 2000

Adjustment to Net Income 2000

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3 years ago