Barry's Brewpub Is Considering Hiring More Brewmasters

question 228

Multiple Choice

Barry's Brewpub is considering hiring more brewmasters.A pint of brew sells for $3.The market wage of a brewmaster is $150 per day.Assuming that the market for beer is perfectly competitive,Barry's Brewpub will hire another brewmaster only if Barry believes the new brewmaster will:

• A)produce the same number of pints per day as the last brewmaster hired.
• B)produce 50 or more pints per day.
• C)raise average production to 50 or more pints per day.
• D)increase the marginal product by $150 per day.

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Definitions:

Equilibrium Price

The price at which the quantity of goods supplied matches the quantity of goods demanded.

Price Ceiling

A price ceiling is a government-imposed limit on how high a price can be charged for a product or service, typically intended to protect consumers.

Price Ceiling

A legally imposed maximum price on a good or service, intended to prevent prices from rising above a certain level, often leading to shortages.

Equilibrium Level

The state in which market supply and demand balance each other, resulting in stable prices and quantities.