Question

Graphing demand for labor and computing the optimal quantity A company operates in a competitive market, selling each unit of output for a price of $30 and paying the market wage of $375 per day for each worker it hires. In the following table, complete the column for the value of the marginal product of labor (VMPL at each quantity of workers. Marginal Product of Labor Value of the Marginal Product of Labor Labor Output (Dollars) (Number of workers) (Units of output) (Units of output) 16 16 15 31 14

Answer 1

The value of the marginal product of labor is:

1.
`480`

2.
`450`

3.
`420`

4.
`330`

5.
`240`

How to determine this?

The value of the marginal product of labor can be calculated by determining the additional output generated by each additional unit of labor. see the calculation below:

0.

→ 16 × 30= 480

1.

→ 15 × 30 = 450

2.

→ 14 × 30 = 420

3.

→ 11 × 30 = 330

4.

→ 8 × 30 = 240

5.

The marginal product of labor decreases as the number of units of labor increases.

See missing part of the question on the attached image

Answer 2

The value of the marginal product of labor depends on the output price and the marginal product of labor. In a perfectly competitive market, the value of the marginal product of labor equals MPL multiplied by the output price. To calculate it, multiply the MPL with the output price at each quantity of workers.

Step-by-step explanation:

The value of the marginal product of labor depends on the output price and the marginal product of labor (MPL). In a perfectly competitive market, the value of the marginal product of labor equals MPL multiplied by the output price. To calculate the value of the marginal product of labor at each quantity of workers, we need the marginal product of labor and the output price. Once we have this information, we can multiply the MPL with the output price to get the value of the marginal product of labor.

Using the given information, the output price is $30. To calculate the MPL, we subtract the quantity of workers from the previous quantity of workers. For example, for the first row, the quantity of workers is 16, and for the second row, the quantity of workers is 15. Therefore, the MPL for the first row is 16 and for the second row is 1.

Now, multiply the MPL with the output price to get the value of the marginal product of labor for each row. For the first row, the value of the marginal product of labor is 16 x $30, which equals $480. Similarly, for the second row, the value of the marginal product of labor is 1 x $30, which equals $30.