Question: Shown in the following table is the relationship between the number of workers per hour and the total product per hour for a tire company. The relationship between output produced per hour and the price at which it can be sold is also given. Assume that the cost of materials is $6.50.
a. Complete the table.
b. If the wage rate is $5.00 per hour, how many workers should this firm hire to maximize profits? Why?
|
Workers (per hour)
|
Quantity (Total Product per hour)
|
Price of Output
|
TR
|
ArcMR
|
Arc Net MR of Labor
|
ArcMP of Labor
|
ArcMR Product of Labor
|
|
0
|
0
|
$50.00
|
|
|
|
|
|
|
10
|
200
|
$40.00
|
|
|
|
|
|
|
20
|
300
|
$35
|
|
|
|
|
|
|
30
|
350
|
$32.50
|
|
|
|
|
|
|
40
|
380
|
$31.00
|
|
|
|
|
|
|
50
|
400
|
$30.00
|
|
|
|
|
|
|
60
|
410
|
$29.50
|
|
|
|
|
|