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If a Firm Is Producing at the Level of Output

Question 17

Multiple Choice

If a firm is producing at the level of output where the marginal product of labor is greater than the marginal cost of labor (the wage) ,then


A) profits will increase if the firm hires more workers.
B) profits will increase if the firm fires some workers.
C) the firm always has negative economic rent.
D) the accounting profits are always greater than the economic profits.
E) the firm is maximizing profits.

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