Where should a producer stop devoting more of his spending on labor if initially the MRP of the additional dollar spent on labor is higher than the MRP of the additional unit spent on tools?
a. MRP/$ of additional labor falls below MRP/$ of additional tools.
b. MRP/$ of additional capital increases above MRP/$ of additional tools.
c. MRP/$ of additional labor becomes equal to MRP/$ of additional tools.
d. MRP/$ of the additional labor falls to zero.
c
Economics
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To help pay for the cost of sport related injuries, the government imposes a tax on sellers of all sports equipment. Referring to the above figure, the area that equals the tax revenue the government raises from this tax on sports equipment is
A) P1P3ed. B) ecd. C) P0P2ca. D) P1P2cb.
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"The Big Tradeoff" refers to the effect of redistribution on efficiency
Indicate whether the statement is true or false
Economics