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Unformatted text preview: to 6, 4, and then 3. Under competitive product market MRP or money value of the MPP at a fixed price of $5 will be 25, 35, 30, 20 and 15. The firm will decide how many workers need to be employed depending on the present market rate of wages. If the rate of wages is as high as $35 per worker, the firm can employ only two workers. With the wage rate as low as $15 the firm can employ five workers. If we assume that the actual competitive labor market wage rate is $20 the firm can employ 4 workers and remain in equilibrium. At this wage rate the demand and supply forces have been equated....
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This note was uploaded on 11/26/2011 for the course EC ec 201 taught by Professor - during the Fall '10 term at Montgomery.
- Fall '10