"econQuiz 3 0201

"econQuiz 3 0201 - d) 1250 e) None of the above...

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Quiz Econ 415 0201 Hope Enterprises has a short run monthly production function Q = 500L – L 2 . For this function dQ/dL = 500 – 2L. Hope faces perfect competition in its product market: the market price is P = $10.00 per unit of output. In its labor market, Hope is the only employer. The labor supply curve the firm faces is L = 0.2W – 40. Here W is the monthly wage offered workers. Hope Enterprises incurs fixed costs of $300,000 each month. 1) Hope Enterprises will maximize profits hiring ______ workers. a) 130 b) 145 c) 160 d) 192 e) None of the above are correct. 2) Hope Enterprises will offer a monthly wage equal to ______ dollars. a) 500 b) 750 c) 1000
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Unformatted text preview: d) 1250 e) None of the above are correct. 3) The maximum profit for Hope Enterprises equals ______ dollars per month. a) -350,000 b) -66,000 c) 24,000 d) 84,000 e) None of the above are correct. 4) The value of the marginal product of the last worker hired by Hope Enterprises equals ____ dollars. a) 900 b) 1200 c) 1500 d) 1800 e) None of the above are correct. 5) Suppose workers in the labor market form a union, and demand a wage equal to $1400 per month. The maximum profit Hope Enterprises can earn if it pays this wage equals ______ dollars per month. a) -350,000 b) -66,000 c) 24,000 d) 84,000 e) None of the above are correct....
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