The table below shows the total production for varying numbers of hours worked producing yo-yos.The firm sells its product and hires its workers in competitive markets.
TABLE 13-4
-Refer to Table 13-4.A profit-maximizing firm will continue to hire labour to produce yo-yos until they have equated
A)the price of yo-yos and the wage rate per hour.
B)the marginal product of an additional hour of labour and the price of the yo-yos.
C)the wage rate per hour and the value of the yo-yos produced by hiring one additional hour of labour.
D)the marginal revenue product of an additional hour of labour and the price of yo-yos.
E)the wage rate per hour and the marginal product of labour.

Question

The table below shows the total production for varying numbers of hours worked producing yo-yos.The firm sells its product and hires its workers in competitive markets.
  TABLE 13-4
-Refer to Table 13-4.A profit-maximizing firm will continue to hire labour to produce yo-yos until they have equated
A)the price of yo-yos and the wage rate per hour. 
B)the marginal product of an additional hour of labour and the price of the yo-yos. 
C)the wage rate per hour and the value of the yo-yos produced by hiring one additional hour of labour. 
D)the marginal revenue product of an additional hour of labour and the price of yo-yos. 
E)the wage rate per hour and the marginal product of labour.

Quizplus · Accepted Answer

A profit-maximizing firm will hire labor until the wage rate equals the value of the marginal product of labor, which is the additional revenue generated by hiring one more unit of labor.

The Table Below Shows the Total Production for Varying Numbers