Dear Economic
Analyst,
I
need your expertise
in determining how many workers to hire and how much feed to
purchase....
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Economics
Dear EconomicAnalyst,
Ineed your expertisein determining how many workers to hire and how much feed topurchase.The current price of labor is$60 per day, and feed costs$75 per ton.Belowis my marginalphysical product of both labor and feed.
First, my currentbudget is unknown. Can you tell me the order in which I shouldpurchase labor and feed? This order will provide priority whendeciding on my level of inputs.
Secondly, althoughmy budget is not completely known, I am guessing I will have around$480 to spend. If thisamountbecomes my true budget, whatcombination of labor and feed should I choose?
In your report,pleasegiveme all the data you are using for your analysis in a simpletable.Clearly state how you arereaching your recommended decision.
Thank you inadvance,
DonnaPigtail
Owner,Fat PigsInc.
X1(labor)
MPP1
X2(feed)
MPP2
0
0
210
278
1
1
186
255
2
2
162
240
3
3
144
218
4
4
120
188
5
5
102
173
6
6
Answer & Explanation
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4.3 Ratings (769 Votes)
PX1 60 per day PX2 75 per day The budget is 60L 75F 480 It shall be noted that that level of X1 and X2 would be deployed for which the MPP1X1 MPP2X2 That
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