In Exhibit 7­4, Marginal Returns Begin to Diminish with the Hiring

question 20

Multiple Choice

In Exhibit 7­4, marginal returns begin to diminish with the hiring of the__________ worker.

• A)second
• B)third
• C)fourth
• D)fifth
• E)sixth

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Definitions:

Labor Demand

The complete number of employees that employers are prepared and capable of hiring at a certain salary level during a specific timeframe.

Profit

The financial gain achieved when the revenue from business activities exceeds the expenses, costs, and taxes needed to sustain those activities.

Barber

A person whose profession involves cutting, dressing, grooming, styling and shaving men's and boys' hair or beards.