As Applied to Labor Demand,the Marginal Approach to Profit

question 68

Multiple Choice

As applied to labor demand,the marginal approach to profit

• A)is irrelevant
• B)requires setting marginal cost equal to the wage rate
• C)requires setting marginal revenue equal to the wage rate
• D)says that a firm should increase employment if doing so adds more to revenue than it adds to cost
• E)says that a firm should decrease employment if doing so adds more to cost than it adds to revenue

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Definitions:

Lease Payments

Regular payments made by a lessee to a lessor for the use of leased property, equipment, or vehicles, as agreed upon in a lease contract.

Deductible Business Expenses

Expenses incurred during business operations that can be subtracted from gross income to reduce taxable income.

Depreciation

The allocation of the cost of a tangible asset over its useful life, reflecting the decrease in value over time due to use and wear.

Tax Purposes

The reason or intent behind financial decisions or transactions primarily to comply with tax regulations or optimize tax benefits.