The Following Question(s) Deal with the Gizmo Company, Which Has

question 35

Multiple Choice

The following question(s) deal with The Gizmo Company, which has the following production function:

-If the real wage is equal to 8 widgets,and only an integer number of workers can be hired,the Gizmo company should hire

• A) 2 workers.
• B) 3 workers.
• C) 4 workers.
• D) 5 workers.
• E) 6 workers.

---

Definitions:

Interest Revenue

Income earned from deposit accounts or investments through the interest paid by the borrower to the lender.

Incremental Borrowing Rate

The interest rate a lessee would have to pay if borrowing over a similar term, and with similar security, the funds necessary to lease or purchase an asset.

Lessor's Implicit Rate

The interest rate used in lease agreements, assumed by the lessor, that when applied to the lease payments, equals the fair value of the leased asset.