Suppose a firm is a price searcher in the product market and hires labor in a perfectly competitive labor market. The firm hires four workers, the marginal product of the fourth worker is 4, and the wage rate is $40 . The firm produces 100 units of the product, which sell for a price of $10 each. This firm is
a. maximizing profit when it hires four workers
b. not maximizing profit and should hire more workers to increase profit
c. not maximizing profit and should hire fewer workers to increase profit
d. maximizing profit when it produces 100 units of the product
e. not maximizing profit when it produces 100 units of the product and should increase production to increase profit
C
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Specialization and trade do not allow individuals, firms, or even nations to acquire goods that lie beyond their production capabilities
a. True b. False Indicate whether the statement is true or false
Dent 'n' Scratch Used Cars and Trucks employs 3 salesmen. Data for their sales last month are shown in this table: Cars Sold Trucks SoldLarry105Joe99Ralph312Based on last month's data, Joe's opportunity cost of selling a car is ________ than Ralph's, and Joe's opportunity cost of selling a car is ________ than Larry's.
A. greater; greater B. less; greater C. less; less D. greater; less
The final consumer demand for chicken (normal good) in China will shift to the left if
A. consumer income decreases. B. fewer consumers are present in the market. C. the price of chicken decreases. D. Either A or B occurs.
Refer to the above figure. A price control has been set which has led to a shortage. This means that a
A. price floor has been set at P1. B. price ceiling has been set at P1. C. price floor has been set at P2. D. price ceiling has been set at P2.