Amanda owns a small bakery in the perfectly competitive pastry industry. She is considering whether to hire an additional pastry chef. The wage rate for pastry chefs is $1,000 per week; the marginal product of an additional pastry chef is 1,000 pastries per week; and the unit price of pastries is $1.25. Amanda should: hire the additional pastry chef. not hire the additional pastry chef. O raise the price of the pastries. O Not enough information is given to answer the question.
Amanda owns a small bakery in the perfectly competitive pastry industry. She is considering whether to hire an additional pastry chef. The wage rate for pastry chefs is $1,000 per week; the marginal product of an additional pastry chef is 1,000 pastries per week; and the unit price of pastries is $1.25. Amanda should: hire the additional pastry chef. not hire the additional pastry chef. O raise the price of the pastries. O Not enough information is given to answer the question.
Chapter5: Supply, Demand, And Price: Applications
Section: Chapter Questions
Problem 14QP
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