A Firm in a Competitive Input Market Can

question 309

Multiple Choice

A firm in a competitive input market can

• A) hire workers at the going wage.
• B) hire additional workers only by raising wages.
• C) hire additional workers at lower wages because those who are still unemployed are anxious to work.
• D) hire additional workers only after a long search process.

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Definitions:

Product Market

The marketplace in which final goods or services are offered to consumers, businesses, and the public sector.

Labor

The human effort, both physical and mental, that is used to produce goods and services.

Consumer Spending

The total amount of money spent by households and individuals in an economy on goods and services, an important indicator of economic health.

Consumption Expenditures

The total amount of money spent by households and individuals on goods and services for personal use.