Write a 4- to 5-page paper that's addresses the following questions:
1. Discuss two factors that would increase demand for labor. (Hint: Recall that the demand for factors of production or resources is called a derived demand)
2. If the market price of the good or service that a firm produces increases, what happen to the demand of labor? Explain.
3. Numerical Problems. Answer the two questions below.
a. What would be the marginal production at a level of 20 workers? Calculate. What can be said about the total production of cars as more workers are added (Hint: use the economic concept from the chapter in your answer)?
b. Using your answer from (a) and using the information below:
i. Each worker costs the firm $4,000 per month.
ii. Each acre of land costs the firm $1,000 per month.
iii. Each machine costs the firm $600 per month.
- Each worker costs the firm $4,000 per month.
- Price of the output (car) is $20,000
Should the firm move from the 15th to the 20th worker? In other words, should the firm hire 20 workers? Why?