Pennsylvania's largest grower of fresh-to-market tomatoes announced in March 2009 he will no longer produce the crop. The acreage he previously devoted to tomatoes and pumpkins will be converted to field corn that is harvested by machines
Of the following, which could have led to the shift from labor intensive tomato production to field corn? A) The market price of tomatoes increased.
B) Farm workers' reservation wage fell.
C) The wage rate for farm workers increased.
D) All of the answers are true.
C
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Would the owner of a profit-maximizing fast-food establishment hire another worker for $55 per day if that worker added faster service, increasing sales and revenue by $50 per day? Why or why not?