Principles of Economics, 7th Edition

Published by South-Western College
ISBN 10: 128516587X
ISBN 13: 978-1-28516-587-5

Chapter 18 - Part VI - The Markets for the Factors of Production - Questions for Review - Page 391: 4

Answer

The prevailing wage can be increased to attract workers (or decreased to repel workers).

Work Step by Step

The prevailing level of wages are what will be paid since a firm would only hire a worker to the point that the marginal product of labor is the same as the wage
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