Unformatted text preview: monopolist in its product market. If the going wage rate is $28, how many workers will Key West employ? (Hint: First find the production function and the MP E .) (b) Now suppose that the Parrot Shop is the only employer in town (but can only charge one wage) and faces an hourly supply of labor given by: w = 0.9E + 5 where w is the hourly wage rate and E is the number of workers hired each hour. How many workers should the Parrot Shop hire each hour to maximize its profit? What wage will it pay? How much will it charge for each cap? (Hint: First find the MC E .)...
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This note was uploaded on 12/06/2010 for the course ECON 4616 taught by Professor Antman during the Fall '08 term at Colorado.
- Fall '08