[OPE-L:6273] Historical, real and current costs

Sat, 14 Mar 1998 18:02:51

Questions on the PIAF:

> Date: Sat, 14 Mar 98 18:40:55 UT
> From: "andrew kliman" <Andrew_Kliman@CLASSIC.MSN.COM>
> To: ope-l@galaxy.csuchico.edu
> Subject: [OPE-L] Historical, real and current costs (all 3 examples)

Andrew J. K. writes:

> Take a single day. Assume that workers work 100 hours and produce 100
> widgets, the only commodity. Through 9 p.m., the price per widget
> is $1. The workers quit work at 5 p.m., get paid $99 for doing
> their days work, and use this money to buy and consume
> $99/($1/widget) = 99 widgets -- all before 9 p.m. At 9 p.m., the
> price per widget falls to $0.98. The widgets finish drying (they
> need to be dry before anyone will buy them) after 9 p.m.
> Moneybags then takes them and sells them, before midnight.

1. What is a "widget"? None of my 3 English Dictionaries include this

2. Where do the widgets bought and consumed by the workers before 9
pm come from? Are there stocks of widgets? Are there other widget

3. Do the produced widgets require and additional process of
"drying"? Wouldn''t this process need some living labor or other
inputs (kind of fixed capital)?

4. Is the producer you are describing an "average producer", in the
sense s/he uses an "average technique"?

5. It seems the produced widgets are sold after 9 pm and before
midnight. You say that the price at 9 pm (and I suppose that after
this) is $0.98. If the producer is a "price taker", s/he cannot sell
his/her widgets for $1 so, the 100 hours cannot be expressed as $100,
so s/he wouldn''t be an "average producer".

Alejandro Ramos