Explain how firms determine the right quantity of labor to employ.
What will be an ideal response?
Answers will vary but should include discussion of marginal revenue product, the
additional revenue a firm obtains from employing one more unit of input. In order to
maximize profits, the firm hires up to the point at which the wage equals the expected
marginal revenue product. In other words, the firm expects that the additional revenue
generated by the worker will exceed the cost of his or her employment. Hiring beyond
that point does not add profits.
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You decide to spend Thanksgiving with your grandparents instead of going to Las Vegas with 20 of your closest friends. Losing the chance to be with your friends is the ________ cost of spending Thanksgiving with your grandparents
A) explicit B) implicit C) deferred D) accrued
A person quits her job in order to spend time looking for a better paying job. This is an example of
A. seasonal unemployment. B. cyclical unemployment. C. frictional unemployment. D. structural unemployment.
State and local taxes as a group seem to be mildly progressive, but federal taxes as a group seem to be mildly regressive.
Answer the following statement true (T) or false (F)
In long?run equilibrium for a monopolistically competitive firm, the firm's demand curve is ________ its average total cost curve.
A. above B. below C. just tangent to D. either above or below