Use the Data in the Table Below to Answer the Following

question 119

Essay

Use the data in the table below to answer the following questions about a firm.
Units of Units of Total Marginal Output
Input X Input Y Product Product of X Price
0 25 0 $10
1 25 2 10
2 25 7 10
3 25 14 10
4 25 20 10
5 25 23 10
6 25 24 10
a. Complete the table by calculating the marginal product of input X.
b. Compute the marginal revenue produce of input X.
c. If the price of input X were $30 per unit, how many units should the firm use per unit of time to maximize profit? Explain why profit is maximized.

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Definitions:

Economic Instability

A situation where an economy experiences significant fluctuations in its economic activities, such as employment, output, and prices, often leading to uncertainty and unpredictability.

Activist Monetary Policy

Activist monetary policy refers to proactive measures taken by central banks to counteract economic fluctuations through adjusting interest rates and altering the money supply to stabilize the economy.

Monetarists

Economists who believe that variations in the money supply have major influences on national output in the short run and the price level over longer periods, and that objectives of monetary policy are best met by targeting the growth rate of the money supply.

Real GDP

The market value of all final goods and services produced within a country in a particular period, adjusted for inflation.