Table 17-1

-Refer to Table 17-1.Suppose the output price is $3.If the firm represented in the table is maximizing its profit by hiring six workers, what is the wage rate?
A)$120
B)$65
C)$40
D)There is insufficient information to answer the question.

Question

Table 17-1
 
-Refer to Table 17-1.Suppose the output price is $3.If the firm represented in the table is maximizing its profit by hiring six workers, what is the wage rate?
A)$120 
B)$65 
C)$40 
D)There is insufficient information to answer the question.

Quizplus · Accepted Answer

The marginal product of the sixth worker is 3, and the output price is $3. Therefore, the marginal revenue product of the sixth worker is $9. The wage rate must be less than $9 for the firm to maximize its profit by hiring six workers. The only wage rate that is less than $9 is $65.

Table 17-1 -Refer to Table 17-1.Suppose the Output Price Is $3.If the Price