Refer to the above table. Suppose the firm hires 4 workers and the price of the good sold is $4. The marginal factor cost of labor must be
A) $4.
B) $150.
C) $3080.
D) $600.
Ans: D) $600.
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The ability of the federal government to regulate the distribution of income among families and individuals is
A) enormous, as shown by the redistribution that has occurred from the rich to the poor since World War II. B) largely limited to what can be accomplished through revisions in the rules of the game. C) unlimited because government is sovereign. D) virtually unlimited because few people would be willing to emigrate merely in order to escape taxation.
Suppose a developing country receives more machinery and capital equipment as foreign entrepreneurs increase the amount of investment in the economy. As a result
A) the economy will move up along the long-run aggregate supply curve. B) the long-run aggregate supply curve will shift to the left. C) the long-run aggregate supply curve will shift to the right. D) the economy will move down along the long-run aggregate supply curve.
A firm is currently hiring capital and labor so that MPL/PL < MPK/PK. If the firm wishes to maximize profits it should hire
A. more labor and less capital. B. less labor and less capital. C. less labor and more capital. D. more capital and more labor.
The NBER's Business Cycle Dating Committee picks recession dates by looking at many variables, the four most important of which are industrial production, manufacturing and trade sales, nonfarm employment, and real personal income. These variables are known as
A. lagging indicators. B. recession indicators. C. leading indicators. D. coincident indicators.