Question

A firm can hire six workers at a wage rate of $8 per hour but must pay $9 per hour to all of its employees to attract a seventh worker. The marginal wage cost of the seventh worker is A. $9. B. $10. C. $15. D. $21.

Answer 1

Answer:

The correct answer is C. 15$.

Explanation:

The marginal or incremental cost in decision making means effect that company have on its financial statement if the option under consideration is choosen.

In the above question the company will have to pay 9$ dollars to the seventh worker plus it has to increase pay of its six existing workers by 1$ per hour. So marginal wage cost is (9+6)= 15.