What Two Factors Should You Equate in Deciding How Many

question 43

Multiple Choice

What two factors should you equate in deciding how many workers to employ?

• A)the marginal product of labour and the marginal product of capital
• B)the marginal product of labour and the real wage rate
• C)the marginal product of labour and the real interest rate
• D)the marginal product of capital and the real wage rate

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Definitions:

American Wheat

Refers to wheat produced in the United States, a major global exporter of wheat, known for its quality and used both domestically and internationally.

Derived Demand

The demand for a good or service that arises from the demand for another good or service; for example, the demand for steel is derived from the demand for automobiles.

Wage Rate

The amount of money a worker is paid per unit of time, such as an hour or a month.

Marginal Physical Product

The additional output resulting from one more unit of a specific input, assuming all other inputs remain constant.