The Cost of Hiring One More Worker, Ceteris Paribus, Is

question 226

Multiple Choice

The cost of hiring one more worker, ceteris paribus, is known as

• A) marginal revenue product.
• B) marginal physical product.
• C) marginal factor cost.
• D) marginal wage.

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Definitions:

Equilibrium Price

The price at which the quantity of a good or service demanded by consumers equals the quantity supplied by producers, leading to market balance.

Mutually Beneficial Trades

Exchanges between parties that provide benefits or gains to all involved, enhancing their welfare or utility.

Well-Functioning Markets

Markets that efficiently allocate resources through the mechanism of supply and demand, leading to optimal outcomes for both buyers and sellers.

Market System

An economic system where decisions regarding investment, production, and distribution are based on supply and demand, and prices of goods and services are determined in a free price system.