Other Things Held Constant, After Some Point Hiring Additional Units

question 91

Multiple Choice

Other things held constant, after some point hiring additional units of labor will cause the marginal physical product of labor to decline because

• A) the firm is a price taker.
• B) the wage rate increases when additional workers are hired.
• C) of the law of diminishing marginal product.
• D) the supply of labor is perfectly elastic.

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Definitions:

Transactions

The act of conducting business or commercial dealings, such as buying, selling, or exchanging goods, services, or financial instruments.

Profits

The surplus remaining after total costs are deducted from total revenue, and an indicator of the financial health and success of a business.

Hydraulic Fracturing

A technique used in the oil and gas industry to increase extraction rates by injecting fluid into subterranean rocks to create fractures.

Fracking

A process of injecting liquid at high pressure into subterranean rocks, boreholes, etc., to force open existing fissures and extract oil or gas.