Which statement is true?
A. If the MRP of the last worker hired is higher than the wage rate, the firm has hired too few workers.
B. The most important influence on a firm's demand for a factor of production is the demand for the final product.
C. A firm will keep hiring more and more of a resource up to the point at which its MRP is equal to its price.
D. All of the statements are true.
D. All of the statements are true.
You might also like to view...
When firms in monopolistic competition are making an economic profit, firms will
A) enter the industry, and demand will increase for the original firms. B) exit the industry, and demand will increase for the firms that remain. C) exit the industry, and demand will decrease for the firms that remain. D) enter the industry, and demand will decrease for the original firms.
Suppose the market demand for milk is Qd = 150 - 5P. Additionally, suppose that a dairy's variable costs are VC = 2Q2 (where Q is the number of gallons of milk produced each day), its marginal cost is MC = 4Q and there is an avoidable fixed cost of $50 per day. In the long run there is free entry into the market. Suppose the demand for milk doubles. If in the short run the number of firms is fixed and their fixed costs are sunk, how much does each of the active firms produce in the short run equilibrium?
A. 5 units B. 6 units C. 10 units D. 20 units
The fact that U.S. national security depends upon what other nations spend on their national security means that
a. the U.S. may end up with less national security even if it devotes more resources to national security b. the U.S. should devote fewer resources to national security c. the U.S. should devote even more resources to national security than it considers desirable d. the U.S. can never be secure e. peace is an impossible dream
The monetarists believe
A. the Federal Reserve is very effective at fighting inflation. B. the key to stable economic growth is a constant rate of increase in the money supply. C. expansionary monetary policy will permanently reduce the interest rate. D. the money supply must increase at the same rate as the price level.