Oscar's Flower Shop Maximizes Profits by Hiring 4 Workers in a Perfectly

question 16

Multiple Choice

Oscar's Flower Shop maximizes profits by hiring 4 workers in a perfectly competitive labour market.The workers and their value of the marginal product of labour are Noe,$40;Barbara,$35;Calvin,$27;and Diana,$15.According to the marginal productivity theory of income distribution,which statement is TRUE?

• A) In equilibrium,each worker is paid his or her value of the marginal product of labour.
• B) Each worker is paid a wage equal to the highest value of the marginal product of labour .
• C) Each worker is paid $15.
• D) We need to know the product price before we can figure out the wage rate.

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Definitions:

Media Richness

Media richness theory posits that the effectiveness of communication varies with the richness of the medium used, rating from face-to-face (richest) to numerical documents (least rich).

Telephone

A communication device that transmits and receives sound, typically voices, over long distances using wire or radio technology.

E-mail

A digital method of sending and receiving messages over the internet between individuals or groups.

Emotional Contagion

The phenomenon where emotions are transferred from one person to another, either consciously or unconsciously, leading to shared feelings among individuals or groups.