1. Is a flexible firm more or less likely to employ workers up to the point where their MRP = MC_L?

2. Would you expect the advent of flexible firms to alter the gender balance of employment and unemployment?

3. If a firm is trying to achieve flexibility in its use of labour, do you think this would be harder or easier in a period of recession? Explain why.

4. Assume workers in a firm are allowed to choose between a 20 per cent reduction in pay, or 20 per cent of the workforce being laid off. What factors would influence the workers’ choice?