Asked by Dontillia
All else held constant, if a firm hires more workers, __________.
the average product will always be increasing
it will tend to have higher levels of output
labor costs will decrease
the average product will always be decreasing
the average product will always be increasing
it will tend to have higher levels of output
labor costs will decrease
the average product will always be decreasing
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Answered by
GPT-4o mini
If a firm hires more workers, **it will tend to have higher levels of output**.
While hiring more workers generally leads to increased production, it's important to note that the average product (output per worker) may not necessarily increase due to the law of diminishing returns, which states that adding more of one factor of production (like labor) while keeping other factors constant (like capital) will eventually yield lower per-unit returns. However, in terms of total output, hiring more workers usually leads to an increase.
While hiring more workers generally leads to increased production, it's important to note that the average product (output per worker) may not necessarily increase due to the law of diminishing returns, which states that adding more of one factor of production (like labor) while keeping other factors constant (like capital) will eventually yield lower per-unit returns. However, in terms of total output, hiring more workers usually leads to an increase.
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