PRINCIPLES OF MACROECONOMICS(LOOSELEAF)
7th Edition
ISBN: 9781260110920
Author: Frank
Publisher: MCG
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Question
Chapter 7, Problem 7P
(a)
To determine
Determine the total output and the average labor productivity.
(b)
To determine
Determine the total output per painter using a roller.
(c)
To determine
Determine the changes in total output and average labor productivity when technological changes take place.
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Edith is the owner and manager of a small coffee shop that employs three workers who use the shop’s one coffee machine to make and serve coffee to paying customers. Business has begun to pick up; lines are getting longer every day in her shop. On a busy morning, she sees her baristas scrambling to take orders, get cups, fill coffee from the coffee machine, add cream and sugar, and serve customers in a timely manner. She figures if she hires three more baristas she’ll be able to sell twice as much coffee.
a. Adding more and more workers does not constantly increase production because of _______
SELECT THE CORRECT ANSWER
different productivity levels between various laborers.
diminishing marginal costs.
diminishing marginal product of labor.
substitutes in production.
Edith is the owner and manager of a small coffee shop that employs three workers who use the shop’s one coffee machine to make and serve coffee to paying customers. Business has begun to pick up; lines are getting longer every day in her shop. On a busy morning, she sees her baristas scrambling to take orders, get cups, fill coffee from the coffee machine, add cream and sugar, and serve customers in a timely manner. She figures if she hires three more baristas she’ll be able to sell twice as much coffee
Do you think she’s likely to be right? Why or why not?
Yes, hiring more workers will mean more customers can be served.
Yes, more workers will increase the supply and make more coffee available for sale.
No, more workers will just create more chaos behind the counter as the additional workers still have to wait to fill from the coffee machine.
No, the current workers just need better training to work more efficiently.
Adding more and more workers does not constantly increase…
The diagram below shows a natural monopoly.
If the firm is unregulated, how much deadweight loss will there be?
2$
100
76
60
56
48
АТС
36
MC
20
MR
288
360 Q
84
144 180 204
Chapter 7 Solutions
PRINCIPLES OF MACROECONOMICS(LOOSELEAF)
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