The Upstream Brewery has a monopoly on beer sales in the town of Boring View, Nebraska. The demand curve for beer is. P = 300−0.004B where B is the number of six-packs of beer sold per hour, and P is the price of a six-pack, in cents. The brewery is the only employer in town, and the supply curve of Labor is. W = 0.08L + 60 where L is the number of workers, and W is the hourly wage, in cents. Each worker produces one six-pack of beer per hour. How many workers should the brewery hire, to maximize profit? What wage will it pay, and how much will it charge for beer?
The Upstream Brewery has a monopoly on beer sales in the town of Boring View, Nebraska. The demand curve for beer is. P = 300−0.004B where B is the number of six-packs of beer sold per hour, and P is the price of a six-pack, in cents. The brewery is the only employer in town, and the supply curve of Labor is. W = 0.08L + 60 where L is the number of workers, and W is the hourly wage, in cents. Each worker produces one six-pack of beer per hour. How many workers should the brewery hire, to maximize profit? What wage will it pay, and how much will it charge for beer?
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter14: Labor Markets And Income
Section: Chapter Questions
Problem 8SCQ: Table 14.13 shows information from the supply curve for labor for a monopsonist, that is, the wage...
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The Upstream Brewery has a
P = 300−0.004B
where B is the number of six-packs of beer sold per hour, and P is the price of a six-pack, in cents.
The brewery is the only employer in town, and the supply curve of Labor is.
W = 0.08L + 60
where L is the number of workers, and W is the hourly wage, in cents.
Each worker produces one six-pack of beer per hour.
How many workers should the brewery hire, to maximize profit? What wage will it pay, and how much will it charge for beer?
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