Question

In: Economics

From what you have read about employers passing health care costs onto employees, what is a...

From what you have read about employers passing health care costs onto employees, what is a reason an employer may hire a new worker.

A) Their median of wages currently paid compared to existing employees

B) Their contribution to the firm's earnings of the company.

C) The minimun wage currently being paid to existing employees of the same skill and job description

D) An amount that varies depending on degree of skill and the supply of labor in the market.

Solutions

Expert Solution

Option B (Their contribution to the firm's earnings of the company) is correct.

Reason: The firm will hire new workers until the marginal cost of hiring them is equal to the marginal benefit derived from hiring them. The new work will add into the productivity of the firm and therefore will contribute in the increased output and revenue of the firm.

Rahul Sunny answered 2 years ago
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