Mary Is Considering Hiring Another Worker in an Assembly Line

question 36

Multiple Choice

Mary is considering hiring another worker in an assembly line for Bluetooth speakers.Mary knows the average product of labor is 15 speakers per day.She also believes that the next worker hired will produce an extra 12 speakers per day.A speaker sells for $10.Assuming that the market for speakers is perfectly competitive,Mary should hire another worker:

• A)only if the new worker's marginal product is 12 or more.
• B)only if the new worker's daily wage is $150 or less.
• C)only if the new worker's daily wage is $120 or less.
• D)since the marginal product is below the average product.

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Definitions:

Borrowing Rate

The interest rate or cost that a borrower pays to a lender to borrow money.

Long-Term Projects

Ventures or initiatives with a timeline extending over several years, typically requiring substantial capital investment and planning.

Short-Term Financing

Borrowing options intended for a short period, typically less than a year, to cover immediate needs.

Matching Principle

An accounting concept stating that expenses should be matched with the revenues they help to generate, ensuring accurate financial reporting.