The table below shows levels of employment (Labor), the marginal product at each of those levels, and the price at which the firm can sell output in a perfectly competitive market. Value of the marginal product of labor Labor Marginal Product of Labor Price of the Product Value of the Marginal Product 1 7 $3 2 6 $3 3 5 $3 4 4 $3 5 3 $3 Complete the table finding the Value of the Marginal Product (show your work!). If the wage rate is $15, what is the firm’s profit maximizing level of employment? Justify your answer!
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