A Soybean Farmer Sells Soybeans in a Perfectly Competitive Market

question 126

Multiple Choice

A soybean farmer sells soybeans in a perfectly competitive market and hires labor in a perfectly competitive market.The market price of soybeans is $1 a bushel,the wage rate is $12,the farmer employs six workers,and the marginal product of the sixth worker is 10.What would you advise this farmer to do?

• A) Do nothing because the wage rate and the marginal product of the last worker hired are equal.
• B) Reduce employment because the wage paid is greater than the marginal revenue product.
• C) Increase employment because the wage paid is less than the marginal revenue product.
• D) Increase the product price so that the wage and marginal revenue product will be equal.

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Definitions:

Stereotypes

Oversimplified and generalized beliefs about a group of people that often ignore individual differences and complexities.

Bias

A predisposition or preconceived notion that influences a person's perspective, behavior, or judgment, often in an unfair or negative way.

Prejudiced

Having preconceived opinions or judgments about someone or something that are not based on reason or actual experience, often manifesting in unfair and discriminatory attitudes.

Jigsaw Method

A cooperative learning strategy where students from diverse backgrounds work in pieces to complete a puzzle-like problem.