When the MPP of Labor Is Zero, Ceteris Paribus

question 88

Multiple Choice

When the MPP of labor is zero, ceteris paribus,

• A) Employment can be increased only by offering a higher wage rate.
• B) No further increases in output can be achieved by using additional units of labor.
• C) MRP is at a maximum.
• D) Additional units of labor must be employed because other factors of production are being wasted. Marginal physical product (MPP) is equal to the change in total output associated with one additional unit of input. If the MPP is zero, the last worker hired does not contribute any additional output.

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The risk inherent to the entire market or market segment, which cannot be eliminated through diversification.

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Unsystematic risk refers to the risk associated with individual investments or sectors, not affected by broader market movements.

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The probable returns on an investment averaged over a period, accounting for the varying risks and rewards.

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