problem9keyS06

problem9keyS06 - E303. Davis Problem Set 9 Fall 2005 KEY 1....

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E303. Davis Problem Set 9 Fall 2005 KEY 1. Optimal Use of a Single Input. Julian Smyth is manages production at Taffy Apple Inc., a company that produces a variety of taffy/fruit candies. Over the last several months, he has varied then number of employees on his caramel apple production line, and found the following relationship. Labor TP MP MRP 5 100 6 150 50 250 7 230 80 400 8 300 70 350 9 360 60 300 10 410 50 250 11 450 40 200 12 480 30 150 a. In the column labeled MP, calculate the marginal product of labor. (Note, make your first entry in row 6, as the change between 5 and 6 units of labor) See listings under MP b. Suppose the apples sell for $5 per (dozen) box. Calculate the Marginal Revenue Product (MRP) See listing under MRP c. If labor costs $225 per day, how many laborers should the firm hire? Number ______10___________________________________
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2. Optimal Use of a Single Input. A Graphical Representation. a.
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This note was uploaded on 04/12/2010 for the course ECON 303 taught by Professor Shrestha during the Fall '08 term at VCU.

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problem9keyS06 - E303. Davis Problem Set 9 Fall 2005 KEY 1....

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