MrSmith's Firm Competes in a Perfectly Competitive Market

question 31

Multiple Choice

Mr.Smith's firm competes in a perfectly competitive market.The firm is currently hiring 30 workers.The value of marginal product of the last worker is $7.00 per hour.The wage rate is $8.00 per hour.To increase profit,Mr.Smith

• A)continues hiring 30 workers because the firm earns a surplus of $1.00 on each worker hired.
• B)increases the price of the firm's product so that the value of marginal product of the last worker hired increases to $8.00 per hour.
• C)decreases the price of the firm's product so that the value of marginal product of the last worker hired increases to $8.00 per hour.
• D)decreases the number of workers until the value of marginal product of labour of the last worker hired equals $8.00.
• E)increases the number of workers until the value of marginal product of labour of the last worker hired equals $8.00.

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Definitions:

PET

Positron Emission Tomography, a type of imaging test that allows doctors to check for diseases in the body by using a special dye containing radioactive tracers.

fMRI

Functional Magnetic Resonance Imaging, a neuroimaging technique that measures brain activity by detecting changes associated with blood flow.

Control Groups

Groups in experiments that do not receive the experimental treatment, allowing researchers to assess the treatment's effect by comparing it against this baseline.

Experimental Groups

Groups in an experiment that receive the treatment or variable being tested, allowing researchers to assess its effects.