Assuming an interior solution, a production plan is profit maximizing if and only if all marginal revenue products are equal to input prices.
Answer the following statement true (T) or false (F)
True
Rationale: This is the condition that must hold for isoprofit planes to be tangent to production frontiers.
You might also like to view...
When shopping the consumer is interested in absolute prices
Indicate whether the statement is true or false
Vertical integration can sometimes be used to
a. Avoid paying higher taxes b. Reward the retailer for undertaking the risk inherent in introducing a new product c. Serve as a "signal" of the manufacturer's belief of the likely success of his product d. All of the above
Refer to the diagram. At the profit-maximizing output, total variable cost is equal to:
A. 0AHE.
B. 0CFE.
C. 0BGE.
D. ABGH.
As price declines, quantity demanded goes _______ and quantity supplied goes ________.
A. up; up B. down; down C. up; down D. down; up