Econ 545 week 8 final exam (devry)

units? Show all work. (Be careful here!)

3.

Question : (TCO C) You have been hired to manage a small manufacturing facility whose cost and production data are given in the table below.

Total Total Workers Labor Cost Output Revenue 1 $500 100 $700 2 1000 280 1150 3 1500 440 1440 4 2000 540 1570 5 2500 600 1670 6 3000 630 1710 7 3500 640 1730 (a.) (6 points) What is the marginal product of the second worker? (b.) (6 points) What is the marginal revenue product of the fourth worker? (c.) (6 points) What is the marginal cost of the first worker? (d.) (12 points) Based on your knowledge of marginal analysis, how many workers should you hire? Explain you answer.

4.

Question : (TCO C) Answer the next questions on the basis of the following cost data for a firm in pure competition: OUTPUT ------ TFC ---------- TVC 0 $100.00 0.00 1 100.00 70.00 2 100.00 120.00 3 100.00 150.00 4 100.00 200.00 5 100.00 270.00 6 100.00 360.00 (a.) (15 points) Refer to the above data. If the product price is $45 at its optimal output, will the firm realize an economic profit, break even, or incur an economic loss? How much will the profit or loss be? Show all calculations. (b.) (15 points) Refer to the above data. If the product price is $75 at its optimal output, will the firm realize an economic profit, break even, or incur an economic