Asked by Jessie Kindley on Jun 11, 2024
Verified
If a firm faces an upsloping labor supply curve (and there is no union or minimum wage) ,its:
A) MRC curve is also upsloping.
B) MRC curve is perfectly elastic.
C) MRP curve is perfectly inelastic.
D) MRP curve is also upsloping.
Upsloping Labor Supply Curve
A graphical representation indicating that as wages increase, the quantity of labor supplied also increases.
MRC Curve
The Marginal Resource Cost curve, representing the additional cost incurred by employing one more unit of a resource in production.
- Understand the methods by which companies establish employment levels and wages in both competitive and monopsonistic markets.
- Examine the effects of marginal product and marginal wage cost on the determination of employment.
Verified Answer
DC
Dessy ChristinaJun 14, 2024
Final Answer :
A
Explanation :
When a firm faces an upsloping labor supply curve, it means that as the firm hires more labor, the wage rate it must pay for additional workers increases. Therefore, the marginal resource cost (MRC), which is the additional cost of hiring one more unit of labor, also increases, leading to an upsloping MRC curve.
Learning Objectives
- Understand the methods by which companies establish employment levels and wages in both competitive and monopsonistic markets.
- Examine the effects of marginal product and marginal wage cost on the determination of employment.
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