- 10. When is a firm's rate of hiring likely to be highest?
A. during a phase of negative marginal returns
B. during a phase of uncertain marginal returns
C. during a phase of increasing marginal returns
D. during a phase of decreasing marginal returns
Answer: c. During a phase of increasing marginal returns.
Explanation: since the firm is making more money, they will need to have more employees in order to fit product demand, therefore it will hire more people.
