In theory, if a profit-maximizing firm in a perfectly competitive labor market found it advantageous to hire one less worker, the firm should pay a
A. lower wage rate to all previous workers hired.
B. higher wage rate to all previous workers hired.
C. higher wage rate but only to the most recently hired workers.
D. lower wage rate but only to the most recently hired workers.
Answer: A
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Suppose you hit a progressive jackpot on a 25-cent Fortunemaker slot machine in a casino in Las Vegas and are given the choice of the following prizes:
Prize 1: $200,000 to be received right away, with four additional payments of $200,000 to be received each year for the next four years. Prize 2: $750,000 to be received right away. If the interest rate is 3 percent, what is the present value of each prize?
If a given fiscal policy is fully accommodated by monetary policy, then
A) GDP will remain constant. B) the interest rate will remain constant. C) GDP and the interest rate will move in the same direction. D) GDP and the interest rate will move in the opposite direction.
When the marginal revenue product of an input is less than its price, the
a. producer should expand the use of that input. b. price of the input will automatically rise in a free market. c. producer should reduce the use of that input. d. marginal physical product of that input must be below its average physical product.
Assuming a long-run aggregate supply curve, a decrease in consumer confidence results in ________ in output and ________ in price level.
A. a decrease; no change B. no change; a decrease C. a decrease; a decrease D. an increase; no change