Utilize the following information to answer the following question, which assumes perfectly competitive markets: Wage (MFC):$40 Price of good sold (P):$2 Marginal physical product (MPP) from the 8 th workers hired: 20 Question: Should the firm increase the amount of workers hired? A. Yes, due to the fact MRP>MFC. Therefore, a firm can maximize profits by hiring additional workers. B. Yes, due to the fact MFC=MRP. Therefore profits can be increased by hiring additional workers. C. No, the firm should hire exactly 8 workers because at that point MRP=MFC; which is the profit maximizing level of labor hired. D.No. the firm should hire exactly 8 workers because at that point MRP>MFC; which is the profit maximizing level of labor hired
Utilize the following information to answer the following question, which assumes perfectly competitive markets: Wage (MFC):$40 Price of good sold (P):$2 Marginal physical product (MPP) from the 8 th workers hired: 20 Question: Should the firm increase the amount of workers hired? A. Yes, due to the fact MRP>MFC. Therefore, a firm can maximize profits by hiring additional workers. B. Yes, due to the fact MFC=MRP. Therefore profits can be increased by hiring additional workers. C. No, the firm should hire exactly 8 workers because at that point MRP=MFC; which is the profit maximizing level of labor hired. D.No. the firm should hire exactly 8 workers because at that point MRP>MFC; which is the profit maximizing level of labor hired
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Utilize the following information to answer the following question, which assumes perfectly competitive markets:
Wage (MFC):$40
Price of good sold (P):$2
Marginal physical product (MPP) from the 8 th workers hired: 20
Question:
Should the firm increase the amount of workers hired?
A. Yes, due to the fact MRP>MFC. Therefore, a firm can maximize profits by hiring additional workers.
B. Yes, due to the fact MFC=MRP. Therefore profits can be increased by hiring additional workers.
C. No, the firm should hire exactly 8 workers because at that point MRP=MFC; which is the profit maximizing level of labor hired.
D.No. the firm should hire exactly 8 workers because at that point MRP>MFC; which is the profit maximizing level of labor hired.
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