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Asked by Sophie Hansen on May 30, 2024

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Edna has a monopoly in the sale of engineering services in the local market. Also, Edna is the only employer of high skilled labor in the local market. The marginal product of labor is: Edna has a monopoly in the sale of engineering services in the local market. Also, Edna is the only employer of high skilled labor in the local market. The marginal product of labor is: (L) = 250. The marginal revenue of engineering services is: MR(L) = 12,000 - 0.25L The local supply of high skilled labor is: L<sup>S</sup> (w) = 200w - 10,000 Or equivalently w = 50 + 0.005L<sup>S </sup> This implies Edna's marginal high-skill labor wage bill expenditures is: ME(L) = 50 + 0.01L Determine Edna's optimal level of employment. Also, what is the wage rate Edna pays for a unit of high skilled labor? What is the marginal revenue of the product of labor at the optimal employment level? Suppose Edna acted as a wage taker in determining high-skilled labor employment. How much labor would she hire and at what wage rate? At this level of employment, calculate the marginal revenue of the product of labor. (L) = 250.
The marginal revenue of engineering services is:
MR(L) = 12,000 - 0.25L
The local supply of high skilled labor is:
LS (w) = 200w - 10,000
Or equivalently
w = 50 + 0.005LS
This implies Edna's marginal high-skill labor wage bill expenditures is:
ME(L) = 50 + 0.01L
Determine Edna's optimal level of employment. Also, what is the wage rate Edna pays for a unit of high skilled labor? What is the marginal revenue of the product of labor at the optimal employment level? Suppose Edna acted as a wage taker in determining high-skilled labor employment. How much labor would she hire and at what wage rate? At this level of employment, calculate the marginal revenue of the product of labor.

Marginal Product

The additional output resulting from using one more unit of a production input, keeping all other inputs constant.

Marginal Revenue

The supplementary income generated from the sale of an extra unit of a good or service.

High Skilled Labor

High Skilled Labor refers to jobs that require advanced knowledge or abilities, often gained through extensive education or specific training, and typically command higher wages.

  • Assess the perfect amount of labor hiring by analyzing the marginal product of labor, wage levels, and marginal revenue.
  • Analyze the connection between marginal revenue product, compensation levels, and the number of employed in monopoly scenarios.
  • Understand the relationship among labor supply, wage expenses, and marginal cost functions in deciding the best employment level for labor.
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ZK
Zybrea KnightJun 05, 2024
Final Answer :
To determine Edna's optimal level of employment given she is a monopsonist, we need to set: To determine Edna's optimal level of employment given she is a monopsonist, we need to set: Since Edna is a monopolist in the sale of engineering services, This information allows us to determine Edna's optimal employment of labor as: We now use the information from labor supply to determine the wage rate Edna will pay. This wage rate is: The marginal revenue of the product of labor at the optimal level of employment is: If Edna acted as a wage taker in hiring labor, she would set: In this case, Edna would employ At this level of employment, the wage rate is: The marginal revenue of the product of labor at this employment level is $289.98. Since Edna is a monopolist in the sale of engineering services, To determine Edna's optimal level of employment given she is a monopsonist, we need to set: Since Edna is a monopolist in the sale of engineering services, This information allows us to determine Edna's optimal employment of labor as: We now use the information from labor supply to determine the wage rate Edna will pay. This wage rate is: The marginal revenue of the product of labor at the optimal level of employment is: If Edna acted as a wage taker in hiring labor, she would set: In this case, Edna would employ At this level of employment, the wage rate is: The marginal revenue of the product of labor at this employment level is $289.98. This information allows us to determine Edna's optimal employment of labor as: To determine Edna's optimal level of employment given she is a monopsonist, we need to set: Since Edna is a monopolist in the sale of engineering services, This information allows us to determine Edna's optimal employment of labor as: We now use the information from labor supply to determine the wage rate Edna will pay. This wage rate is: The marginal revenue of the product of labor at the optimal level of employment is: If Edna acted as a wage taker in hiring labor, she would set: In this case, Edna would employ At this level of employment, the wage rate is: The marginal revenue of the product of labor at this employment level is $289.98. We now use the information from labor supply to determine the wage rate Edna will pay. This wage rate is: To determine Edna's optimal level of employment given she is a monopsonist, we need to set: Since Edna is a monopolist in the sale of engineering services, This information allows us to determine Edna's optimal employment of labor as: We now use the information from labor supply to determine the wage rate Edna will pay. This wage rate is: The marginal revenue of the product of labor at the optimal level of employment is: If Edna acted as a wage taker in hiring labor, she would set: In this case, Edna would employ At this level of employment, the wage rate is: The marginal revenue of the product of labor at this employment level is $289.98. The marginal revenue of the product of labor at the optimal level of employment is: To determine Edna's optimal level of employment given she is a monopsonist, we need to set: Since Edna is a monopolist in the sale of engineering services, This information allows us to determine Edna's optimal employment of labor as: We now use the information from labor supply to determine the wage rate Edna will pay. This wage rate is: The marginal revenue of the product of labor at the optimal level of employment is: If Edna acted as a wage taker in hiring labor, she would set: In this case, Edna would employ At this level of employment, the wage rate is: The marginal revenue of the product of labor at this employment level is $289.98. If Edna acted as a wage taker in hiring labor, she would set: To determine Edna's optimal level of employment given she is a monopsonist, we need to set: Since Edna is a monopolist in the sale of engineering services, This information allows us to determine Edna's optimal employment of labor as: We now use the information from labor supply to determine the wage rate Edna will pay. This wage rate is: The marginal revenue of the product of labor at the optimal level of employment is: If Edna acted as a wage taker in hiring labor, she would set: In this case, Edna would employ At this level of employment, the wage rate is: The marginal revenue of the product of labor at this employment level is $289.98. In this case, Edna would employ To determine Edna's optimal level of employment given she is a monopsonist, we need to set: Since Edna is a monopolist in the sale of engineering services, This information allows us to determine Edna's optimal employment of labor as: We now use the information from labor supply to determine the wage rate Edna will pay. This wage rate is: The marginal revenue of the product of labor at the optimal level of employment is: If Edna acted as a wage taker in hiring labor, she would set: In this case, Edna would employ At this level of employment, the wage rate is: The marginal revenue of the product of labor at this employment level is $289.98. At this level of employment, the wage rate is: To determine Edna's optimal level of employment given she is a monopsonist, we need to set: Since Edna is a monopolist in the sale of engineering services, This information allows us to determine Edna's optimal employment of labor as: We now use the information from labor supply to determine the wage rate Edna will pay. This wage rate is: The marginal revenue of the product of labor at the optimal level of employment is: If Edna acted as a wage taker in hiring labor, she would set: In this case, Edna would employ At this level of employment, the wage rate is: The marginal revenue of the product of labor at this employment level is $289.98. The marginal revenue of the product of labor at this employment level is $289.98.

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