Given that the market wage rate is $50 and both the labor and the goods market are perfectly competitive, a profit-maximizing firm should hire an additional worker if:
A) the marginal product of the worker is 50 units.
B) the value of marginal product of the worker is at least $50.
C) the marginal product of the worker is less than 50 units.
D) the value of marginal product of the worker is less than $50.
B
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If the substitution effect is stronger than the income effect, a decrease in real interest rates will ________ current consumption for households who are lenders and will ________ current consumption for households who are borrowers
A) increase; decrease B) decrease; increase C) increase; increase D) increase; have an unclear effect on
The interest rate that the Fed charges banks that borrow reserves from it is the
a. federal funds rate b. discount rate c. reserved rate d. investment rate e. check rate
Suppose that Emily opens a restaurant. She receives a loan from a bank for $200,000 . She withdraws $100,000 from her personal savings account. The interest rate on the loan is 6%, and the interest rate on her savings account is 2%. Emily's annual explicit cost of capital is
a. $2,000. b. $4,000. c. $12,000. d. $14,000.
The increasing wage inequality in the United States is between ________ workers and ________ workers.
A. old; young B. highly-skilled; unskilled C. service-sector; industrial-sector D. male; female