DSE2008 (Ques 41-46, Option A)

[Rain Man]

Hi

In Q 41 - I am using MPL = W/P ( Marginal Product of Labor = Real Wage ) . This should give us the demand for labor.
In Q 43 - I am Maximizing the Utility subject to the constraint PC = WLs . This should give us the supply for labor.

But I am not able to arrive at the correct solution in either of them :( .

Please let me know if my approach isn't right .

Please provide a detailed solution too :)


Thanks

[Rain Man]

Please take this one up. I am stuck on this :(

[s]

for 41.
max profit =P*Y -WL-rKbar...wrt L..

u'l get option b...

42. max U=C^b+(Lbar - Ls)^b st PC=WLs....put Ls=PC/W in U fn n max wrt C

its pretty straightforward,i guess u r making a calculation error.