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The local Lincoln Paralegal Union has observed that the Bureau of Labor Statistics projects that employment of paralegals over the next decade will rise considerably faster than the employment of lawyers (https://www.bls.gov/emp/ep_table_107.htm), which it uses to push its paralegal members to receive a wage of $21.50 due to their high demand. Further, your analysis of the larger pool of paralegals suggests some diminution of their productivity, and that paralegals will soon be able to only write on average three briefs per hour. If the other values remain the same (attorney wage and writing speed, need for sixty briefs per hour), would the company save money in the writing of the sixty legal briefs by hiring six newly-graduated paralegals and firing some attorneys?
Select one:
a. Yes. The four paralegals lead to a minimization of marginal product per dollar, which is preferred by the company.
b. No. The decreased productivity and higher wage results in the marginal product per dollar of paralegals being below the marginal product per dollar of lawyers. The cost of using only lawyers is now cheaper than using six paralegals and seven lawyers.
c. No. The paralegals are now producing a higher marginal product per dollar than they were before, so it is more expensive to use them than using only attorneys.
d. Yes. The higher productivity of the attorneys is the only relevant factor and since the paralegal marginal product is still less than that of attorneys, they should not be hired.
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