What happens to the marginal revenue product curve of a factor as more of a complementary factor is hired?
A) It shifts to the left, because its marginal product decreases.
B) It shifts to the left, because its marginal product increases.
C) It shifts to the right, because its marginal product decreases.
D) It shifts to the right, because its marginal product increases.
D
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An expansion
A) follows a peak. B) is defined as a period of negative real GDP growth. C) comes just before a trough. D) is defined as a period of real GDP increases.
A firm in monopolistic competition maximizes its profit by ________
A. differentiating its good and producing the quantity at which price equals marginal revenue B. producing the quantity at which marginal revenue equals marginal cost and then adding a markup C. raising its price and producing so that it always has excess capacity D. producing the quantity at which marginal cost equals marginal reve-nue and charging the highest price at which it can sell that quantity
The supply curve illustrates that firms:
A. increase the quantity supplied of a good when its price rises. B. decrease the quantity supplied of a good when input prices rise. C. decrease the supply of a good when its price rises. D. increase the supply of a good when its price rises.
A monopolistically competitive firm maximizes profit by producing where marginal revenue equals marginal cost.
Answer the following statement true (T) or false (F)