The equilibrium wage rate is $18. a perfectly competitive firm sells widgets for $8. suppose the marginal product of the 6th unit of labor is 3 widgets and the marginal product of the 9th unit of labor is 2 widgets. this firm should hire:

should hire the sixth employee whose marginal product is 3 widgets

Explanation:

Since we are not given information about the seventh and eighth employee's marginal product, we cannot know if they should be hired or not.

A competitive firm must hire employees to a point where marginal labor cost equals marginal revenue product.

Marginal labor cost = $18

Marginal revenue product sixth employee = 3 widgets x $8 per widget = $24

Marginal revenue product ninth employee = 2 widgets x $8 per widget = $16

marginal revenue product for the sixth employee is higher than marginal labor cost, therefore the employee should be hired

marginal revenue product for the ninth employee is lower than the marginal labor cost, therefore the employee should bot be hired

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