Use the following table to answer the questions below. Number of Chefs Number of Pizzas produced per day 1 5 2 25 3 40 4 50 5 55 6 58 7 58 Find the marginal product (MP) for each value of L. Chefs...

Use the following table to answer the questions below.

1. Find the marginal product (MP) for each value of L.
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   
   

   Chefs	Pizzas	MPL
   1	5	5
   2	25	20
   3	40	15
   4	50	10
   5	55	5
   6	58	3
   7	58	0

   
   


2. The firm is experiencing increasing returns with how many workers?

The increasing returns mean the increase in the marginal product of labor due to the increase in the number of labor or workers. The marginal product of labor is 20 at 2 workers and the marginal product of labor would decrease to 15 with an additional worker so, the firm is experiencing increasing returns with 2 workers.

3. At what number of workers will diminishing marginal returns begin?

The increasing returns mean the increase in the marginal product of labor due to the increase in the number of labor or workers. The marginal product of workers is started to fall from the 3 labor units so the diminishing returns begin from the employment of 3 workers.

4. Find the marginal revenue product (MRP) for each value of L, assuming the price of a pizza is $10.

5. If the price of a pizza is $10 and each chef’s wage is $50 per day, how many chefs will this competitive pizza shop hire in order to maximize profits?

6. At the optimal quantity of labor, the (economic) profit equals $_______.