Grantham ECN201 2022 November Week 7 Assignment Latest

ECN201 Microeconomics

Week 7 Assignment

Labor and Wages

The following chart provides information on

 firm that hires labor competitively and sells

its product in a competitive market.

Units of Labor     Total Output     Product Price

1                            14                        $5

2                            26                        $5

3                            37                        $5

4                            46                         $5

5                            53                         $5

6                            58                        $5

a.    How many units of labor would be employed if the market wage rate were $40? Why?

b.    What would happen to employment if the wage rate rose to $50? Explain your answer.