Aliyah is preparing to expand her IT consulting company. The current market rate for IT professionals is $58,000 per year. Each employee she hires will also require a computer and equipment that costs $6,000 per employee annually. Hiring more employees means that Aliyah can provide consulting services to more clients each year. Each client Aliyah has will pay her $10,000 per year. The number of clients Aliyah can take on is dependent on the number of workers she hires and is depicted in the accompanying table. Use this information to calculate the marginal cost and the marginal benefit of hiring each worker. Number of workers Clients per year0 01 112 203 274 32a. The first worker's marginal cost is $.b. The first worker's marginal benefit is $.c. The second worker's marginal cost is $.d. The second worker's marginal benefit is $.e. The third worker's marginal cost is $.f. The third worker's marginal benefit is $.g. The fourth worker's marginal cost is $.h. The fourth worker's marginal benefit is $.i. Using the rational rule to maximize her economic surplus, Aliyah should hire workers.

In economics terms, the marginal cost is the cost that is caused by a change in the total cost that arises because of the increase in the quantity produced, and the cost of producing the additional quantity. It is calculated as the change in the cost is divided by the change in quantity.

a. The first worker marginal cost is

= The current market rate for IT professionals + computer and equipment cost

= $58,000 + $6,000

= $64,000 per year

b.The marginal benefit per worker for hiring the first worker is

c . The second worker marginal cost is

= The current market rate for IT professionals + computer and equipment cost

= $58,000 + $6,000

= $64,000 per year

d The second worker marginal benefit is

e The third worker marginal cost is

= The current market rate for IT professionals + computer and equipment cost

= $58,000 + $6,000

= $64,000 per year

f. The third worker marginal benefit is

g. The fourth worker marginal cost is

= The current market rate for IT professionals + computer and equipment cost

= $58,000 + $6,000

= $64,000 per year

h. The fourth worker marginal benefit is

I. Aliyah will employ 3 workers because the extra marginal gain to the worker is greater than the marginal cost. It implies the hiring worker's cost is less than the benefits they receive.

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Answer and Explanation:

a. The first worker marginal cost is

= The current market rate for IT professional + computer and equipment costing

= $58,000 + $6,000

= $64,000 per year

b.The marginal benefit per worker for hiring first worker is

= Pay each client × number of clients  

= $10,000 × 11 clients

= $110,000

c . The second worker marginal cost is

= The current market rate for IT professional + computer and equipment costing

= $58,000 + $6,000

= $64,000 per year

d The second worker marginal benefit is

= Pay each client × number of clients  

= $10,000 × (20 clients - 11 clients)

= $90,000

e The third worker marginal cost is

= The current market rate for IT professional + computer and equipment costing

= $58,000 + $6,000

= $64,000 per year

f. The third worker marginal benefit is

= Pay each client × number of clients  

= $10,000 × (27 clients - 20 clients)

= $70,000

g. The fourth worker marginal cost is

= The current market rate for IT professional + computer and equipment costing

= $58,000 + $6,000

= $64,000 per year

h. The fourth worker marginal benefit is

= Pay each client × number of clients  

= $10,000 × (32 clients - 27 clients)

= $50,000

I. Aliyah will employ 3 workers, because the extra marginal gain to the worker is greater than the marginal cost. It implies the hiring worker's cost is less than the benefits they receive.

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