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6 marksThe Demand for and Supply of Factors

CAPE Economics Unit 1 · 2016 · Paper 2 · Question 5(b)(i)

A firm manufactures belts selling for 70 each with a daily wage of 500 per worker.

Copy and complete the table to show the marginal product and the value of the marginal product.

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Other parts of this question

  1. 5(a)(i)Draw a labour market diagram, and show on your diagram how a surge of migrants into the country will affect the equilibrium wage and level of employment.[5 marks]
  2. 5(a)(ii)Draw a labour market diagram, and show on your diagram how an increase in world demand for tourism will affect the equilibrium wage and level of employment.[5 marks]
  3. 5(b)(ii)Sketch the firm's labour demand curve.[3 marks]
  4. 5(c)(i)Determine the number of workers who will be hired if the government sets a minimum wage of $1000 per day.[3 marks]
  5. 5(c)(ii)Justify the manager's employment of FIVE workers per day in the manufacture of belts.[3 marks]

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