If the Hourly Wage of U

question 78

Multiple Choice

If the hourly wage of U.S. workers is $16, the hourly wage of Mexican workers is $2, and U.S. workers produce 9 times as much output per hour as Mexican workers, then, all else equal, it would be efficient to locate production facilities in:

• A) the United States since the cost per unit of output will be higher.
• B) the United States since the cost per unit of output will be lower.
• C) Mexico since the cost per unit of output will be higher.
• D) Mexico since the cost per unit of output will be lower.

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