An auto service station has four mechanics. If the marginal revenue product of the fourth worker is $375 per day and the mechanics are paid $150 per day, the firm
A. can make a greater profit by laying off some of the mechanics.
B. can make a higher profit by hiring more mechanics
C. is maximizing profits.
D. will reduce its profits if it hires more mechanics.
B. can make a higher profit by hiring more mechanics
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If the price of Pepsi increases, then there will be ________ of Pepsi.
A. a decrease in the supply B. a decrease in the quantity supplied C. an increase in the supply D. an increase in the quantity supplied
Introduction of checks into the payments system reduced the costs of exchanging goods and services. Another advantage of checks is that
A) they provide convenient receipts for purchases. B) they can never be stolen. C) they are more widely accepted than currency. D) the funds from a deposited check are available for use immediately.
On the graph above, suppose the economy is at point F when there is a temporary negative supply shock. The new long-run equilibrium is at point ________
A) H B) I C) F D) G E) none of the above
When a good is excludable:
A. one person's consumption prevents or decreases others' ability to consume it. B. it is possible for sellers to prevent its use by those who have not paid for it. C. consumers have a perception of scarcity of that good. D. the government has specific import policies limiting its supply.