A Profit-Maximizing Firm in a Competitive Market Will Continue to Hire

question 57

Multiple Choice

A profit-maximizing firm in a competitive market will continue to hire more workers when

• A) the marginal factor cost exceeds the marginal revenue product of the additional workers.
• B) the marginal factor cost equals the marginal revenue product of the additional workers.
• C) the marginal factor cost is less than the marginal revenue product of the additional workers.
• D) the marginal factor cost is less than zero.

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Definitions:

Highest Price

The maximum price at which a good, service, or asset is sold in the market, often influenced by factors such as scarcity, demand, and quality.

Pure Monopolist

An entity that is the sole provider of a particular product or service in a market, without any competitors, effectively controlling the market.

Increase Price

A strategy or action where the selling price of goods or services is raised to generate higher revenue or cope with increased costs.

Volume of Sales

The total quantity of goods or services sold by a company within a specific period.