If a firm can hire six workers at $12 per hour but in order to hire the 7^th worker it must pay all its workers $14 per hour then the additional cost of that worker is:

Question

Quizplus · Accepted Answer

The firm can hire 6 workers at $12 per hour, which means their total wage bill for those 6 workers is:

6 workers x $12 per hour = $72 per hour

If they hire the 7th worker, they have to pay all workers $14 per hour, so their new wage bill is:

7 workers x $14 per hour = $98 per hour

The additional cost of the 7th worker is the difference between the new wage bill and the old wage bill:

$98 per hour - $72 per hour = $26

Therefore, the additional cost of the 7th worker is $26. Choice B is the correct answer.

If a Firm Can Hire Six Workers at $12 Per