Putski Concrete Co. hires one additional worker. Output goes up by 10 units per day,

This must have been a good (i.e. profit-maximizing) hiring decision.

True/False?

The statement is not necessarily true. While hiring an additional worker resulted in an increase of 10 units of output per day, the profitability of this decision depends on the marginal cost of hiring that worker compared to the additional revenue generated from the increased output. If the additional revenue from selling those 10 units exceeds the cost of employing the new worker, then it was indeed a good decision; otherwise, it may not be.

Furthermore, firms often operate under different conditions and scales. In some cases, an additional worker might lead to diminishing returns, where the increase in output may not justify the labor cost. This means that while the initial decision to hire may seem good, ongoing assessments of productivity and cost-effectiveness are essential to ensure continued profitability.