The following table is a record of the data of a competitive firm on labour and output:
Unit of labour Total product MPL VMPL
0 0
1 10
2 22
3 32
4 39
5 42
6 41
Suppose the product price is $5 and the market wage per unit of labour is $35.
a) Reproduce the above table on your answer sheet and complete the table.
b) How many units of labour should be employed to maximise profit? Briefly explain your answer.