The Assumption That a Firm Operates in a Competitive Labor

question 20

Multiple Choice

The assumption that a firm operates in a competitive labor market means that

• A)the firm offers a real wage rate that is indexed for inflation.
• B)the firm faces an upward-sloped marginal cost of labor curve.
• C)the firm faces a downward-sloped marginal cost of labor curve.
• D)the firm faces a constant wage regardless of how much labor it employs.
• E)the firm doesn't use capital in the production process.

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Definitions:

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