calculate the equilibrium price of the product using the supply and demand functions
economics
Description
Micro Economics
Homework #8
Due: Tuesday May 5
Marginal Revenue Product
The Demand
function is Qd = 1,000 – 20*P
The Supply
function is Qs = 400 + 10*P
L Qd Peq TRc MRc Pm TRm MRPm
0 0
10 200
20 360
30 480
40 560
50 600
Use the relationship between Labor and Output to answer complete
the chart and answer the following questions:
I. In a competitive
market:
a) calculate the
equilibrium price of the product using the supply and demand functions
b) create the “ Total Revenue” and “Marginal
Revenue Product” columns
c) Estimate the
number of laborers hired when the wage rate is $200
II. Now consider the behavior of a
monopolist.
a) calculate the
price at each level of output (Q) by using (only) the demand function
b) create the “ Total
Revenue” and “Marginal Revenue Product” columns
c) Estimate the
number of laborers hired by the monopolist when the wage rate is $200
