A company can produce and sell f(L) tons of a product per month using L hours of labor
Chapter 4, Problem 32(choose chapter or problem)
A company can produce and sell f(L) tons of a product per month using L hours of labor per month. The wage of the workers is w dollars per hour, and the finished product sells for p dollars per ton. (a) The function f(L) is the companys production function. Give the units of f(L). What is the practical significance of f(1000) = 400? (b) The derivative f(L) is the companys marginal product of labor. Give the units of f(L). What is the practical significance of f(1000) = 2? (c) The real wage of the workers is the quantity of product that can be bought with one hours wages. Show that the real wage is w/p tons per hour. (d) Show that the monthly profit of the company is (L) = pf(L) wL. (e) Show that when operating at maximum profit, the companys marginal product of labor equals the real wage:
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