When we focus on the firm as a supplier of a good or a service, we assume that the firm is a profit maximizer. When we focus on the firm as a demander of labor, we assume that the firm's objective is to
A)minimize wages.
B)minimize variable costs.
C)maximize the number of workers hired.
D)maximize profit.

Question

Quizplus · Accepted Answer

When a firm is a demander of labor, its objective is to maximize profit. This means that the firm will seek to employ the optimal number of workers at the lowest cost possible, while still being able to produce the desired level of output. This is the same objective as when the firm is a supplier of a good or a service, and it seeks to maximize revenue and minimize costs in order to maximize profit.

When We Focus on the Firm as a Supplier of a Good