If the Marginal Product of Labour Is Less Than the Nominal

question 23

Multiple Choice

If the marginal product of labour is less than the nominal wage divided by the price of output,a firm that wishes to maximize profits will

• A) hire more labour.
• B) lay off workers.
• C) maintain its current level of workers.
• D) raise the real wage.

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Definitions:

Questionable Receivables

Accounts receivable that might not be collected due to issues like customer disputes or financial instability.

Budgeted Comparisons

The process of comparing budgeted financial forecasts with actual financial performance to identify variances and make adjustments.

Historical Comparisons

The analysis of past data to identify trends, patterns, or changes over time, often used in financial analysis.

Competition Comparisons

An analysis technique used by companies to evaluate their position relative to competitors in the market, focusing on strengths, weaknesses, opportunities, and threats.