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Suppose there is perfect competition in the output market and the labor market and that the output price is $10 and the wage is $350 per hour. In this case, the demand for labor by the firm equals _____
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Suppose there is perfect competition in the output market and the labor market and that the output price is $10 and the wage is $350 per hour. In this case, the demand for labor by the firm equals _____ hours.

User Fapps
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Answer:

2 hours of labor

Step-by-step explanation:

Labor is hired up to a point where the marginal product of labor * Price of the output = wage of the worker.

Thus, 35 * 10 = 350.

35 widgets are produced using 2 hours of labor.

User Harwalan
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