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Gertrude Stork's Chocolate Shoppe normally employs 4 workers. When the Chocolate Shoppe hired a 5th worker the Shoppe's total output decreased. Therefore
a. the total output of Gertrude Stork's Chocolate Shoppe is negative.
b. the 5th worker should be hired only if he is willing to accept a wage lower than the wage paid to the other 4 workers.
c. the average product of the 5th worker is negative.
d. the marginal product of the 5th worker is negative.

Respuesta :

Answer: Option(d) is correct.

Explanation:

Marginal product of labor is defined as the quantity produced or change in output occur by adding an additional worker in the production of certain goods and services.

A firm or a company demand for a worker until a point where the value produce by that worker equals the wage rate.

In our case, shoppe's total output decreases as it employed a 5th worker. This is because of the marginal product. This means that an additional worker is not affordable for the firm because it decrease the overall output of the firm.

Therefore, this is because of the negative marginal product of 5th worker.

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