This preview shows page 1. Sign up to view the full content.
Unformatted text preview: the jeans manufacturer acts to maximize profit, how many pairs of jeans will be produced? 23 How many workers will be employed? 4 What will the jean manufacturer's profit be at this output level? $330 Why? (State the key condition used in your analysis and show all work in the table above.) Choose L so that (1) Max. Total Economic Profit = Max (TVP TC, or ( 2 ) M V P = M C (c) Now assume that each worker's wage drops to $30 per day. What is the new profit maximizing total output? 24 How many workers are hired at this level? 5 Why? Same as (b) (d) As a result of the input cost decrease specified in part (c), have profits risen or fallen? risen By how much have profits changed ? $240...
View Full Document
- Fall '09