If a Firm Is a Factor Price Taker in the Labor

question 17

Multiple Choice

If a firm is a factor price taker in the labor market,

• A)it must pay higher wages in order to hire additional workers.
• B)it can hire all the workers it wants to at the going wage rate.
• C)it must hire all workers who apply for a job.
• D)it will continue to hire workers as long as MFC > MRP.

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Definitions:

Landlords Leaving

The phenomenon where property owners exit the rental market, which can be due to various factors including regulatory changes or shifts in market conditions.

Binding Price Ceiling

A maximum price set by the government below the equilibrium price, causing shortages.

Lower Quality

Refers to products or services that do not meet the expected standards or performance criteria compared to others in the market.

Price Ceilings

Legally imposed maximum prices on goods or services that aim to keep them affordable for consumers, which can lead to shortages if set below the market equilibrium.