The best number of workers for any employer to hire is that quantity in which:
A. the marginal revenue product equals the marginal factor cost.
B. the marginal revenue product exceeds the marginal factor cost.
C. total costs are minimized.
D. total revenue is maximized.
Answer: A
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Since revenue increases with increases in price when demand is relatively inelastic, monopolists produce on the inelastic part of demand.
Answer the following statement true (T) or false (F)
In 2004, hurricanes damaged a large portion of Florida's orange crop. As a result of this, many orange growers were not able to supply fruit to the market
If, following the hurricane, the price remained at its pre-hurricane level, we would expect to see A) a surplus of oranges. B) a shortage of oranges. C) an increase in the demand for oranges. D) the quantity demanded equal to the quantity supplied.
Refer to above figure. Now, suppose that the relative price of A is actually not higher than Albania's autarkic level of 1, but quite the opposite (e.g., PA/PB = 0.5)
Would Albania still be able to gain from trade? If so, where would be its production point? Given the information in this question, where is Albania's comparative advantage?
Which of the following is not an advantage of modern corporations?
a. Limited liability b. Longevity and permanence c. More likely to earn higher profits d. Ease of attracting investors