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The Marginal Product of Labor (Measured in Units of Output)of

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Essay

The marginal product of labor (measured in units of output)of a firm is given by
MPN = A(2000 - N)
where A measures productivity and N is the number of labor hours used in production.Suppose the price of output is $6 per unit and A = 0.002.
(a)What will be the demand for labor if the nominal wage is $18?
(b)What will be the demand for labor if the nominal wage rises to $21?


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