Question

The marginal product of labour is described by MPN 20-0.02N, where N is the number of workers the firm employs and MPN is measured in units/hour. The firm is competitive in both, labour and output, markets. In the output market, its price is P= $2/unit. At the nominal wage $18/hour, how many workers would the firm employ?​

Answer 1

Answer:

MPN: 20 million

output:40 million

unit: 60million

p=$2/unit $18/ employ workers:N=20+40+60=120.

Ans:120 million.

unit+hour=employ+workers:price=20-0.02N.