The Following Table Shows the Number of Bread Loaves That

question 79

Multiple Choice

The following table shows the number of bread loaves that can be produced per hour at various levels of labor use.The bakery is a perfectly competitive firm.
Table 16-2
$$\begin{array} { | c | c | } \hline \text { Labor } & \text { Total output } \\\hline 1 & 5 \\\hline 2 & 16 \\\hline 3 & 30 \\\hline 4 & 40 \\\hline 5 & 45 \\\hline 6 & 48 \\\hline 7 & 49 \\\hline\end{array}$$
-Refer to Table 16-2.If the price of bread is $4 per loaf and the hourly wage rate is $12 per hour,how many workers will the profit-maximizing bakery hire?

• A)3
• B)4
• C)5
• D)6

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Definitions:

Pareto Optimal

An economic situation where it is impossible to make any one individual better off without making at least one individual worse off.

Pareto Optimal Allocation

An allocation of resources where no reallocation can make someone better off without making someone else worse off, reflecting a state of optimal efficiency.

Utility Function

A mathematical expression depicting an individual's preference ranking for different bundles of goods or services.

Units of Quiche

The quantifiable amount of quiche, either in pieces or volume, considered in various contexts such as cooking or consumption.