When Firm a Hires One Worker It Pays $8 an Hour

question 65

Multiple Choice

When firm A hires one worker it pays $8 an hour and its total labor cost is $8.When it hires a second worker,it has to pay $8.50 to each of its two workers and its total labor cost is $17.When it hires a third worker,it has to pay $9 to each of its three workers and its total labor cost is $27.For firm A,

• A) its marginal factor cost is above the wage rate it pays, except for the first worker it hires.
• B) its marginal factor cost is above the wage rate it pays, except for the first two workers it hires.
• C) its supply curve of labor lies above its marginal factor cost curve.
• D) it is likely that marginal revenue product always lies above marginal factor cost.
• E) none of the above

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Definitions:

Nonverbal Signals

Communication cues that involve body language, gestures, facial expressions, and other forms of physical behavior apart from verbal communication.

Territorial

Relating to the ownership or division of land, often referring to jurisdictional boundaries by organizations or governments.

Disagreement

A situation where two or more parties have differing views, opinions, or approaches, which can arise in business, personal, or social contexts.

Distance Zone

An area surrounding a person regarded as their personal space, which varies in size depending on cultural norms and personal preferences.