(Daddy Warbucks employs workers in his perfectly competitive factory. Mr. Smith employs workers in his monopolistic factory as the only producer of the thing you really want. Given the following information, determine how many workers each firm will employ: The weekly salary is $206 and the price of each product initially is $15.00.)
Workers Total Product Marginal Revenue
0 0 ---
1 100 $14.00
2 225 $13.00
3 325 $12.00
4 400 $10.00
5 450 $9.00
6 475 $8.00
7 485 $7.00
8 490 $6.00
1. Why does Marginal Revenue Product initially rise, and then fall?
2. Why does a monopolist firm hire fewer workers than a competitive firm?
3.Daddy Warbucks will employ _____ workers. Mr Smith will employ ________ workers.
I need a little assistance, I think I have the correct answers but I need to make sure. Thanks in advanced..
college, Microeconomics - economyst, Tuesday, April 14, 2009 at 10:49am
Take a shot, what do you think?
Repost and i or others will look at your answers.
Hint: I think Warbucks hires 6, Smith hires 5.
college, Microeconomics - Lizzy, Tuesday, April 14, 2009 at 7:37pm
Yes those are the answers I got too! I just wanted to see if I was right..