Question
In: Economics
Consider the following information for a T-shirt manufacturing firm that can sell as many T-shirts as...
Consider the following information for a T-shirt manufacturing firm that can sell as many T-shirts as it wants for $10 per shirt.
| # of Workers | # of shirts produced per day | MPI | TR | MRPI |
| 0 | 0 | |||
| 1 | 40 | |||
| 2 | 85 | |||
| 3 | 135 | |||
| 4 | 195 | |||
| 5 | 50 | |||
| 6 | 285 | |||
| 7 | 315 | |||
| 8 | 200 | |||
| 9 | 100 |
a) Fill in the missing parts of the above table.
b) Verify that MRPl can be calculated in two ways: by change in TR and MPl times product price. If this firm must pay a rate of $285 per day, how many workers would be hired? Briefly explain.
c) Determine the highest wage rate necessary to hire 8 workers. Explain your answer.
d) Suppose the firm adopts a new technology that doubles output at each level of employment and that the price of shirts stays the same. Assume the wage rate is $285 per day. What would be the effect on the new technology on employment? Explain.
Solutions
Rahul Sunny answered 2 years agoRelated Solutions
P&L is a profit-maximizing shirt manufacturing firm. The firm can sell all the shirts it can...
P&L is a
profit-maximizing shirt manufacturing firm. The firm can sell all
the shirts it can produce to retailers at a price of $20 each.
P&L can hire all of the workers it wants at a market wage of
$120 per day per worker. The table below shows the firm’s short-run
production function.
Number of
Workers
Number of
Shirts per Day
0
0
1
10
2
25
3
45
4
60
5
72
6
80
7
85
8
82
Answer...
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as 1 employee, the firm’s Total Product (TP) is 20 shirts/day; with
2 employees, TP=50 shirts/day; with 3 employees, TP=75 shirts/day;
with 4 employees, TP=95 shirts/day; and with 5 employees, TP=110
shirts/day. With zero employees, it produces nothing. Therefore,
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10% Medium 41 20% Large 91 40% Extra Large 68 30% Does the
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The Shirt Shop had the following transactions for T-shirts for 2018, its first year of operations: Jan. 20 Purchased 400 units 8$3,200 Apr. 21 Purchased 200 units @ $10= 2,000 July 25Purchased 280 units e 13 3,640 Sept. 19 Purchased 90 units 151,350 During the year, The Shirt Shop sold 810 T-shirts for $20 each. Required a. Compute the amount of ending inventory The Shirt Shop would report on the balance sheet, assuming the following cost flow assumptions: (1) FIFO,...
The Shirt Shop had the following transactions for T-shirts for Year 1, its first year of...
The Shirt Shop had the following transactions for T-shirts for
Year 1, its first year of operations:
Jan. 20
Purchased
490
units
@
$
8
=
$
3,920
Apr. 21
Purchased
290
units
@
$
10
=
2,900
July 25
Purchased
370
units
@
$
13
=
4,810
Sept. 19
Purchased
180
units
@
$
15
=
2,700
During the year, The Shirt Shop sold 1,080 T-shirts for $24
each.
b. Record the above transactions in general journal form and...
The Shirt Shop had the following transactions for T-shirts for Year 1, its first year of...
The Shirt Shop had the following transactions for T-shirts for
Year 1, its first year of operations:
Jan. 20
Purchased
400
units
@
$
8
=
$
3,200
Apr. 21
Purchased
150
units
@
$
10
=
1,500
July 25
Purchased
200
units
@
$
12
=
2,400
Sept. 19
Purchased
100
units
@
$
14
=
1,400
During the year, The Shirt Shop sold 650 T-shirts for $19
each.
Required
Compute the amount of ending inventory The Shirt Shop...
The Shirt Shop had the following transactions for T-shirts for 2016, its first year of operations:...
The Shirt Shop had the following transactions for T-shirts for
2016, its first year of operations:
Jan. 20
Purchased
460 units @ $8
=
$
3,680
Apr. 21
Purchased
260 units @ $10
=
2,600
July 25
Purchased
340 units @ $13
=
4,420
Sept. 19
Purchased
150 units @ $15
=
2,250
During the year, The Shirt Shop sold 990 T-shirts for $24
each.
Required
a.
Compute the amount of ending inventory The Shirt Shop would...
The Shirt Shop had the following transactions for T-shirts for 2018, its first year of operations:...
The Shirt Shop had the following transactions for T-shirts for
2018, its first year of operations:
Jan. 20
Purchased
400
units
@
$
4
=
$
1,600
Apr. 21
Purchased
90
units
@
$
5
=
450
July 25
Purchased
250
units
@
$
7
=
1,750
Sept. 19
Purchased
60
units
@
$
9
=
540
During the year, The Shirt Shop sold 650 T-shirts for $14
each.
Required
a. Compute the amount of ending inventory The
Shirt Shop...
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