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Chapter 16&17

# Chapter 16&17 - Universidad Iberoamericana UNIBE BBA in...

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Universidad Iberoamericana UNIBE BBA in International Business Microeconomics Professor Osvaldo Lagares Homework Chapter 16-17 Valerie Bodden Kluge (10-0014) Maria Gabriella Liriano (09-0881) Joaquin Castillo (10-0085) December 8, 2010 Santo Domingo, Dominican Republic

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CHAPTER 16 Exercises: 1.5, 3.6, 4.16, 6.3, 6.5 1.5) Number of workers Output of televisions per week Margina l product of Labor Product Price Margina l Revenue Product of Labor Wage Additional Profit from hiring one more worker L Q MP P MR W MR-W 0 0 - \$300 - \$1,800 - 1 8 8 300 \$2400 1,800 \$600 2 15 7 300 2,100 1,800 300 3 21 6 300 1,800 1,800 0 4 26 5 300 1,500 1,800 -300 5 30 4 300 1,200 1,800 -600 6 33 3 300 900 1,800 -900 a. We can say that the firm is a price taker because the product price does not depend on the quantity. b . 3.6) The shift to the left of labor supply shows what will be the effect of the plague depending on the quantity of sailors available at each wage.
Without the government intervention the wage would rise. The shortage of labor equal to L1 – L3. 4.16) In the economics professors setting the wage below equilibrium, reduces the number who are willing to work in this occupation, but increases the number demanded by employers from. The result is a shortage of economics professors. Setting the wage for English professors above equilibrium, increases the number who wants to work in this occupation, but reduces the number demanded by employers. The result is a surplus of English professors.

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6.3) a. Number of Machines Output of Pins Marginal Product of Capital Product Price Total Revenu e Marginal Revenue Product of Capital Rental Cost per Machine Additional Profit (+1 additional machine) L Q MP P TR MRP R MRP-R 0 0 - \$100 \$0 - \$550 - 1 12 12 100 1,200 \$1,200 550 650 2 21 9 100 2,100 900 550 350 3 28 7 100 2,800 700 550 150 4 34 6 100 3,400 600 550 50 5 39 5 100 3,900 500 550 -50 6 43 4 100 4,300 400

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