The marginal product of labor (measured in units of output) of a firm is given by MPN

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The marginal product of labor (measured in units of output) of a firm is given by MPN = A(2000 - N), where A measures productivity and N is the number of labor hours used in production. Suppose the price of output is $6 per unit and A = 0.002.

a. What will be the demand for labor if the nominal wage is $18?

b. What will be the demand for labor if the nominal wage rises to $21?

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Macroeconomics

ISBN: 9780134167398

9th Edition

Authors: Andrew B. Abel, Ben Bernanke, Dean Croushore

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Question Posted: Apr 16, 2024 02:01 AM

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The marginal product of labor (measured in units of output) of a firm is given by MPN

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To determine the demand for labor we need to compare the marginal product of labor to the real ...View the full answer

Macroeconomics

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