"A firm should continue to hire more workers as long as wages are low." Do you agree or disagree? Why?
What will be an ideal response?
Disagree. The firm should hire workers up to the point at which the additional cost associated with hiring the last worker is equal to the additional revenue generated by hiring that worker. What is ignored in the statement is the revenue associated with hiring an additional worker: Even if wages are low, the additional revenue associated with the additional worker may not be enough to cover the additional costs associated with the wages.
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Refer to the diagram above, which represents a country's supply and demand for an internationally traded good
If PW is the world price, and a foreign country engages in dumping by selling at P1, the country's producer surplus will ________ by ________. A) increase; abcd B) decrease; abcd C) increase; bcd D) decrease; a
If you sell twenty-five $100,000 futures contracts to hedge holdings of a Treasury security, the value of the Treasury securities you are holding is
A) $250,000. B) $1,000,000. C) $2,500,000. D) $5,000,000.