Sonny's Surfer Shop produces and sells custom surf boards. Assume that labor is the only input that varies for the firm. The firm's owner has determined that if she hires 10 workers, the firm can produce 10 surf boards per day. If she hires 11 workers, the firm can produce 12 surfboards per day. The firm sells each surfboard for $2,000 . and it pays each of its workers $200 per day. Which of the
following is correct?
a. For the 11th worker, the value of the marginal product of labor is $400.
b. For the 11th worker, the value of the marginal product of labor is $4,000.
c. The firm should not hire the 11th worker since hiring this worker reduces profit.
d. In order to justify hiring the 11th worker the firm will need to raise the price of a surfboard.
b
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A) 45 B) 18 C) 5 D) 12
Assume there are three hardware stores, each willing to sell one standard model hammer in a given time period. House Depot can offer their hammer for a minimum of $7. Lace Hardware can offer the hammer for a minimum of $10. Bob's Hardware store can offer the hammer at a minimum price of $13. Given the scenario described, if the market price of hammers decreased from $17 to $12:
A. producer participation in the market would decrease. B. total producer surplus would remain unchanged. C. producer participation in the market would not be affected. D. producer participation in the market would increase.
Which of the following statements is true concerning DRGs?
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An increase in number of foreign immigrants allowed into the country who wish to work will:
A. increases labor demand. B. increases labor supply. C. decreases labor supply. D. decreases labor demand.