Figure: The Demand for Bricklayers
(Figure: The Demand for Bricklayers) Look at the figure The Demand for Bricklayers.The equilibrium market wage for bricklayers is $100.For a profit-maximizing firm at the equilibrium level of output, the VMPLbricklayers:
A)is $200.
B)is equal to the market wage rate.
C)is irrelevant, since the firm is a price-taker.
D)cannot be determined from the information provided.

Question

Quizplus · Accepted Answer

At the equilibrium level of output, the VMPL of bricklayers will be equal to the market wage rate, which is $100 in this case. A profit-maximizing firm at the equilibrium level of output would hire workers up to the point where VMPL equals the wage rate. Therefore, the correct answer is B.

Figure: the Demand for Bricklayers