DSE 2009 : the ''suraksha'' question q24-25

[Mauli]

http://economicsentrance.weebly.com/uploads/1/1/0/5/1105777/option-a-2009.pdf

please help me with these two!

[Devika]

Hi Mauli :)
 
This is how I did the first part.
The firm is a monoponist in the labour market.

L=w/2 -20

On rearranging we get w= 2L + 40

Now, the total labour cost to the employer is - wL = 2L^2 + 40L

Marginal expenditure (ME) = 4L + 40

Now, from the production we find that MPL =4

TR=py= y(100-y) = 100y - y^2
MR = 100 - 2y

MRPL = MR x MPL = 4(100-2y) = 400 - 8y   => (Since the firm is a monopolist in the output market)
 y = 4L, so MRPL = 400 - 32L

On equating ME and MRPL,we get L =10.

[Devika]

Need help with the second part.

[Mauli]

thankyou so much devika:)
i hope someone helps with the second one.

[SRV]

Check which option maximises Profit i.e. TR - TC