"In order for Charlie Trotter's, an upscale restaurant in Chicago, to maximize profit from the employment of chefs, the restaurant should hire chefs up to the point where the value of marginal product equals the wage rate for chefs"
Is the statement correct or incorrect?
The statement is correct. In order for any firm to maximize its profit, it hires workers until the wage rate equals the value of marginal product.
You might also like to view...
How do balance of trade, balance on current account, and balance of payments differ?
What will be an ideal response?
Assuming that resources are specialized, the opportunity cost of an item increases as production of it rises. Therefore, we expect that firms will produce more if
a. the price increases. b. the price decreases. c. the opportunity cost is greater than the price. d. government asks firms to produce more. e. the income of buyers increases.
Describe the difference between positive and negative incentives. Give an example of each.
What will be an ideal response?
Describe the three-step shift known as the demographic transition
What will be an ideal response?