Mary is considering hiring another worker in an assembly line for Bluetooth speakers.Mary knows that the average product of labour is 15 speakers per day.She also believes that the next worker hired will produce an extra 12 speakers per day.A speaker sells for $10.Assuming that the market for speakers is perfectly competitive,Mary should hire another worker:
A) only if the new worker's marginal product is 12 or more.
B) only if the new worker's daily wage is $150 or less.
C) only if the new worker's daily wage is $120 or less.
D) since the marginal product is below the average product.

Question

Quizplus · Accepted Answer

Mary should hire another worker if the additional revenue from the extra 12 speakers that the new worker produces is greater than or equal to the cost of their daily wage. 
The additional revenue from 12 extra speakers would be 12 x $10 =$120. 
Therefore, the new worker's daily wage should be $120 or less for Mary to profit from hiring them.

Mary Is Considering Hiring Another Worker in an Assembly Line