Marginal productivity theory implies that in a perfectly competitive market economy, a worker will receive income
A) that is less than the value of her marginal contribution to the production process.
B) equal to the value of her marginal contribution to the production process.
C) that is greater than the value of her marginal contribution to the production process.
D) greater than, less than, or equal to the value of her marginal contribution to the production process, depending on her ability to negotiate with employers.
B
You might also like to view...
Which of the following statements is true?
A) Household production is counted in GDP as it amounts to real production. B) GDP growth distributes income equally to people in the economy. C) GDP accounting rules do not adjust for production that pollutes the economy. D) A decrease in the crime rate increases GDP as people will spend more on security.
What did economists Robert Jensen and Nolan Miller determine must be true for a good to be a Giffen good, where the income effect is larger than its substitution effect?
What will be an ideal response?
A large open economy's real interest rate will decrease if
A) the expected future marginal product of domestic capital rises. B) the expected future marginal product of foreign capital rises. C) there is a temporary positive domestic supply shock. D) there is a temporary negative domestic supply shock.
Tom and Jerry have two tasks to do all day: make dishes and build fences. If Tom spends all day making dishes, he will have make 16 dishes. If he instead devotes his day to building fences, Tom will build 4 fences. If Jerry spends his day making dishes, he will make 14 dishes; if he spends the day building fences, he will build 7 fences. Jerry has a comparative advantage in:
A. dish production because he has the higher opportunity cost of a dishes. B. fence production because he has the higher opportunity cost of a fence. C. dish production because he has the lower opportunity cost of a dishes. D. fence production because he has the lower opportunity cost of a fence.