Assume That a Restaurant Is Hiring Labor in an Amount

question 347

Multiple Choice

Assume that a restaurant is hiring labor in an amount such that the MRC of the last worker is $14 and her MRP is $10. On the basis of this information, we can say that

• A)profits will be increased by hiring additional workers.
• B)profits will be increased by hiring fewer workers.
• C)marginal revenue product must exceed average revenue product.
• D)the restaurant is maximizing profits.

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Definitions:

Product Life Cycle

A concept that describes the stages a product goes through from its introduction to the market through its growth, maturity, and eventual decline.