Answer to Question #268696 in Microeconomics for Adi

Question

49. A firm in a competitive market that seeks to maximize profits should employ workers to the point where:

c) the value of the marginal product of labor equal to the wage as the marginal cost of the factor

d) the marginal product of labor equal to wage

Which one is correct c or d?

Answer 1

c) the value of the marginal product of labor equal to the wage as the marginal cost of the factor

Wages should be related to marginal product of labor as it determines the end results of a process.