Suppose That All Workers Place a Value on Their Leisure

question 30

Multiple Choice

Suppose that all workers place a value on their leisure of 75 goods per day. The production function relating output per day Y to the number of people working per day N is Y = 500N - 0.4N² and the marginal product of labour is MPN = 500 - 0.8 N. A 25% tax is levied on wages. Output per day would be

• A) 100,000.
• B) 150,000.
• C) 200,000.
• D) 250,000.

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Definitions:

Poisson Distribution

A probability distribution that models the number of times an event occurs in a fixed interval of time or space when these events occur with a known constant mean rate and independently of the time since the last event.

Nuclear Power Plant

A facility that uses nuclear reactions to generate heat, which is then used to produce electricity.

Probability

A measure of the likelihood that an event will occur, often expressed as a number between 0 and 1.

Poisson Random Variable

A type of discrete random variable that expresses the probability of a given number of events occurring in a fixed interval of time or space.