Use the production data shown on the left and the labor supply data on the right for a single firm to answer the following question. Assume that this firm is selling its product for $1 per unit in a perfectly competitive product market.
|
Units of Labor
|
Total Product
|
Units of Labor
|
Total Product
|
|
0
|
0
|
0
|
-
|
|
1
|
13
|
1
|
1
|
|
2
|
25
|
2
|
2
|
|
3
|
34
|
3
|
3
|
|
4
|
42
|
4
|
4
|
|
5
|
46
|
5
|
5
|
|
6
|
48
|
6
|
1. How many workers will this firm choose to employ?
2. What will be its profit-maximization wage rate?
3. What labor market model do these data best describe?