Suppose That a Firm Has Only One Variable Input,labor,and Firm

question 36

Multiple Choice

Suppose that a firm has only one variable input,labor,and firm output is zero when labor is zero.When the firm hires 6 workers the firm produces 90 units of output.Fixed costs of production are $6 and the variable cost per unit of labor is 10 dollars.The marginal product of the seventh unit of labor is 4.Given this information,what is the marginal cost of production when the firm hires the 7th worker?

• A)1.50
• B)2.50
• C)5
• D)10

---

Definitions:

Job Enrichment

Adding more responsibilities and autonomy to a job, giving the worker greater powers to plan, do, and evaluate job performance.

Job Rotation

The practice of moving employees through a series of job assignments in different areas of the company to broaden their skills and experiences.

Employee Involvement

The degree to which employees are encouraged to contribute their ideas and participate in decision-making processes within an organization.

Competency

A knowledge, skill, ability, or behaviour associated with successful job performance.