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Peter's Pans sells cooking pans for $30 each. The company
hires workers in a competitive labor market and pays each worker
$500/week. Based on the table below, find the VMP and determine
the total number of workers Peter's Pans will hire. Explain why.

# of workers # of pans MP VMP
0 0 0 ?
1 20 20 ?
2 39 19 ?
3 57 18 ?
4 74 17 ?
5 90 16 ?
6 105 15 ?


Required:
1. Fill in the VMP for this chart.

2. How many workers will be hired?

3. Why?

Sagot :

Ogorwyneidn

The value of the VMP are 600, 570, 540, 510, 480, 450. The total workers to be hired are 4 workers because MRL > wage.

How to solve for the VMP

= MP * selling price

  • 20 * 30 = 600
  • 19 * 30 = 570
  • 18 * 30 = 540
  • 17 * 30 = 510
  • 16 * 30 = 480
  • 15 * 30 = 450

This has been computed in the excel file that I have attached to the question.

2. A competitive firm is going to have to hire when the wage is equal to MRPL or MRPL is greater than the wage

based on this the labor of the firm would be at 4 units.

3. Four workers are going to be hired based on the fact that the marginal revenue of the added labor is more than the wage that was paid for the work done.

Read more on marginal revenue here:

https://brainly.com/question/13444663

#SPJ1

View image Ogorwyne
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