Question: The table below shows labor and output combinations for two bars that sell hamburgers for $8 each. Suppose there are initially 6 employees in the

The table below shows labor and output combinations for two bars that sell hamburgers for $8 each. Suppose there are initially 6 employees in the neighborhood, with 4 working at Bar Bleu and 2 working at Phyrst Bar. Each worker is paid the value of the marginal product associated with the last worker hired at each bar.

Question A Using the information above, what are the initial wage rates in each bar? Bar Bleu $ Phyrst Bar $ What is the total combined output of the two bars? Question B Assume now that the job characteristics are the same in both bars and workers can costlessly move between the bars, what is the final employment level (L) at each bar? Bar Bleu L: Phyrst Bar L: What is the total value of output for the two bars? $\f

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