The Following Table Shows the Total Physical Product of Labor

question 97

Essay

The following table shows the total physical product of labor.Compute the marginal physical product of labor and the marginal revenue product of labor at output prices of $10 per unit and $12 per unit.If labor costs $105 per unit,how much should the firm hire at each price of output?
$\begin{array}{l}\begin{array} { c c } \text { Total Physical } & \text { MRP at a } \\\text { MPP of Labor } & \text { Price of } \$ 10 \\\hline 1 & 10 \\2 & 22 \\3 & 35 \\4 & 47 \\5 & 58 \\6 & 68 \\7 & 77 \\8 & 85\end{array}\begin{array} { c c c } \text { MRP at a } && \text { Product } \\\text { Price of } \$ 12 & \underline { \text { Labor } } & \text { of Labor } \\\hline --- & --- & --- \\--- & --- & --- \\--- & --- & --- \\--- & --- & --- \\--- & --- & --- \\--- & --- & --- \\--- & --- & --- \\--- & --- & ---\end{array}\end{array}$

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Definitions:

Milton Friedman

An influential American economist known for his strong belief in free-market capitalism and a minimal role for government in the economy.

Free Market Ethics

Moral principles or standards governing fair and competitive practices in a market economy without undue government intervention.

Duty To Rescue

A legal or moral obligation to provide assistance to a person in danger or distress, under certain circumstances.

Pre-existing Duty

A rule in contract law that states if someone is already legally obligated to perform a certain duty, promising to perform that same duty does not constitute a valid consideration for a new contract.