Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Northern Lumber operates a large lumber-processing mill in a small town in Washington State. It is one of the larger lumber producers in the region and has some market power in the sale of that product. A recent consulting study has indicated that the price elasticity of demand for the firm's product is about -3.0. Also, Northern is the dominant employer in the local labor market, and effectively can be considered as a monopsonist in the purchase of labor. The firm's labor demand (i.e. marginal revenue product) function is; MRP = 1 000 - 2Lwhere L is the number of workers. Because of its size relative to the labor supply in the area, Northern faces an upward sloping labor supply function, w = 50 + 0.025L and ME = 50 + 0.050Lwhere w is the daily wage rate and ME is the marginal expenditure on labor.
Once the firm determines the optimal rate of labor input and the wage rate, the rate of output is determined. The firm uses a cost-plus pricing formula that includes the price elasticity of demand as a determinant in setting product price. The same study indicated that average cost is about RM300 per unit (1 000 board feet) of lumber.
Requirements
1. Determine the amount of labor that the firm should employ in order to maximize profit.
2. Determine the wage rate the firm will have to pay.
3. What price will the firm charge per unit of output?
A risk-neutral agent's working life has two periods. In each period, the agent can provide high effort (at personal cost $2,000) or low effort (at zero personal cost). In a given p
(Kinky Demand Curve) Short Period Kinked demand curve was first used by Prof. Paul M. Sweezy to elucidate price rigidity under oligopoly. In an oligopoly market, firm knows that
Compensatory Financing Two other schemes for alleviating the effects of commodity trade instability have been operating for a number of years. These are the IMF's Compensator
Concept of Central bank M.H. De Kock concept of central bank is superior to that of others as it is more inclusive. His long definition of central bank includes many of the imp
theories of revenue generation
Harrod Domar Theory A basic principle that has been stressed by both Harrod and Domar in their growth models and which has been incorporated in all modern growth theories is th
Difficulties in using fiscal policy There are several problems involved in implementing fiscal policy. They include: Theoretical problems Monetarists and the Keynesia
Write about International economic integration of the Republic of Moldova
Disposable Income This is the income which households actually have available to spend or to save. To calculate disposal income, which is indicated by Ya, the statistician mu
Takes the help of macroeconomics Managerial economics incorporates certain aspects of macroeconomic theory. These are important to comprehending the circumstances and environme
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +91-977-207-8620
Phone: +91-977-207-8620
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd