A firm would expand its workforce until the marginal product of labour is .

less than the wage

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more than the wage

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equal to the wage

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Solution

The correct option is C equal to the wage
The cost of labour is called wage. Any firm would expand its workforce till the benefit experienced from adding an additional unit of labour is equal to the wage. Beyond this point, the cost exceeds benefit and the firm would not employee any more people.

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A firm would expand its workforce until the marginal product of labour is .

The correct option is C equal to the wageThe cost of labour is called wage. Any firm would expand its workforce till the benefit experienced from adding an additional unit of labour is equal to the wage. Beyond this point, the cost exceeds benefit and the firm would not employee any more people.

The correct option is C equal to the wage
The cost of labour is called wage. Any firm would expand its workforce till the benefit experienced from adding an additional unit of labour is equal to the wage. Beyond this point, the cost exceeds benefit and the firm would not employee any more people.