Suppose the Marginal Product of Labor Is 8 and the Marginal

question 51

Multiple Choice

Suppose the marginal product of labor is 8 and the marginal product of capital is 2.If the wage rate is $4 and the price of capital is $2, then in order to minimize costs the firm should use

• A)more capital and less labor.
• B)more labor and less capital.
• C)three times more capital than labor.
• D)none of the statements associated with this question are correct.

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Definitions:

Frederick W. Taylor

Frederick W. Taylor is known as the father of scientific management, a theory that applies scientific principles to increase organizational efficiency and labor productivity.

Dramatically Improved Output

A significant enhancement in the efficiency or productivity of a process, resulting in higher yields or better quality.

Esprit de Corps

A feeling of pride, fellowship, and common loyalty shared by members of a particular group.

Harmonious Effort

Cooperative and synchronized actions among members of a group towards a shared goal.