At What Point Should a Firm Stop Hiring Workers

question 10

Multiple Choice

At what point should a firm stop hiring workers?

• A) when the wage per worker starts to increase
• B) when the price of capital starts to decrease
• C) when the firm's marginal gain in output from hiring an additional worker is zero
• D) when the firm's marginal profit from hiring an additional worker equals the cost of hiring that worker
• E) when the firm's value of marginal product equals zero

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Definitions:

Environmental Constraints

External limitations or conditions that affect an individual's or organization's ability to function or achieve goals.

Objective Environment

The actual, measurable elements in an environment, independent of personal feelings or interpretations.

Strategy Formulation

The development of long-term plans and policies to achieve specific objectives and to manage the direction of a company or organization.

Specific Tasks

Particular jobs or duties assigned to an individual or team.