We Measure the Marginal ________ of a Good by What

question 261

Multiple Choice

We measure the marginal ________ of a good by what a ________ for another unit of the good.

• A) benefit; person must pay
• B) cost; person is willing to pay
• C) benefit; person is willing to pay
• D) cost; person's preferences are

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Definitions:

Marginal Labor Cost

The additional cost incurred by hiring one more unit of labor or the cost of producing one additional unit of output with an additional unit of labor.

Wage Rate

The standard amount of compensation individuals receive in exchange for their labor or services, typically expressed per hour, day, or piece rate.

Labor Demand

The total amount of workers that employers want and are willing to hire at a given wage rate in a certain period.

Labor Supply

Refers to the total hours that workers are willing and able to work at a given wage rate in an economy.