Table 18-6
Consider the Following Daily Production Data for MadeFromScratch

question 13

Multiple Choice

Table 18-6
Consider the following daily production data for MadeFromScratch, Inc. MadeFromScratch sells cupcakes for $3 each and pays the workers a wage of $325 per day.
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$$\begin{array} { | c | c | c | c | c | c | } \hline \begin{array} { c } \text { Labor } \\\text { (Number of } \\\text { workers) }\end{array} & \begin{array} { c } \text { Output } \\\text { (Cupcakes per } \\\text { day) }\end{array} & \begin{array} { c } \text { Marginal } \\\text { Product } \\\text { of Labor } \\\text { (Cupcakes per } \\\text { day) }\end{array} & \begin{array} { c } \text { Value of the } \\\text { Marginal } \\\text { Product of Labor } \\\text { (Cupcakes) }\end{array} & \begin{array} { c } \text { Wage } \\\text { (Dollarsper } \\\text { worker per } \\\text { day) }\end{array} & \begin{array} { c } \text { Margin } \\\text { Profit } \\\text { (Dollar }\end{array} \\\hline 0 & 0 & & & 325 & \\\hline 1 & 200 & & & 325 & \\\hline 2 & 350 & & & 325 & \\\hline 3 & 475 & & & 325 & \\\hline 4 & 575 & & &325 & \\\hline\end{array}$$ ​
-Refer to Table 18-6. Assuming MadeFromScratch is a competitive, profit-maximizing firm, how many workers will the firm hire?

• A)Two workers
• B)Three workers
• C)Four workers
• D)Five workers

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Definitions:

Measurement System

A collection of instruments, standards, and procedures used to quantify physical properties.

Business Activities

All actions undertaken by a company to operate and manage its business, which may include investing, financing, and operating activities.

Communicates

The process of conveying or exchanging information through various means, essential for business operations and relationships.

Partnership

A legitimate business arrangement where two or more partners share both management responsibilities and profits.