Which of the following factors affects employers' decisions on how much to pay their workers?

• A. The price of unrelated goods in the market
• B. The marginal productivity of labor
• C. The weather conditions on the day of hiring
• D. The color of the workplace walls

Answer: (B)

Verified step by step guidance

1. Understand that employers decide wages based on factors that influence the value and cost of labor to their business.
2. Recognize that the marginal productivity of labor refers to the additional output produced by employing one more unit of labor, which directly affects how much a worker contributes to the firm's revenue.
3. Note that factors unrelated to labor productivity, such as the price of unrelated goods, weather conditions, or workplace aesthetics, do not impact the economic value of labor to the employer.
4. Conclude that employers will pay workers based on their marginal productivity because it reflects the worker's contribution to the firm's profits and justifies the wage level.
5. Therefore, among the options, the marginal productivity of labor is the key factor influencing employers' wage decisions.