The owner of a restaurant will hire waiters if the a. additional labor's pay is close to the minimum wage. b. marginal product is at the maximum. c. additional work of the employees adds more to total revenue than to costs. d. waiters do not belong to a union.

Short Answer

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In conclusion, the owner of a restaurant will hire waiters if the additional work of the employees adds more to total revenue than to costs (statement c), as it compares the additional revenue gained with the additional costs incurred when hiring a new employee.

Step by step solution

01

Statement a: Additional labor's pay is close to the minimum wage.

If the additional labor's pay is close to the minimum wage, this means that the cost of hiring waiters is relatively low. However, this statement alone doesn't provide enough information to determine the impact on revenue or productivity. Therefore, we cannot conclude that this condition alone would lead the owner to hire more waiters.
02

Statement b: Marginal product is at the maximum.

When the marginal product is at the maximum, this means that the additional waiter contributes the most possible to the restaurant's output (number of customers served, etc.). In economic terms, hiring a new employee provides the highest possible value at this point in terms of contribution to the overall output. This condition implies that there is a valuable return on hiring more waiters, which might lead the owner to hire more waiters.
03

Statement c: Additional work of the employees adds more to total revenue than to costs.

This statement suggests that hiring an additional waiter means an increase in the restaurant's total revenue compared to the additional costs incurred. In other words, the benefit of having an additional waiter outweighs the cost of hiring them. This condition is the most important to consider, as it is the most likely to lead the owner to hire more waiters.
04

Statement d: Waiters do not belong to a union.

Whether waiters belong to a union or not doesn't necessarily affect the restaurant's revenue or productivity as a direct factor. However, it might impact the cost of hiring and the flexibility of scheduling or dismissal. Since this statement doesn't provide enough information regarding the financial effects or productivity, we cannot conclude that this condition would lead the owner to hire more waiters. In conclusion, the most important condition to consider when deciding whether to hire more waiters is statement c, as it compares the additional revenue gained with the additional costs incurred when hiring a new employee.

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