How are the marginal revenue product (MRP) curve and the demand curve for capital related?
a. MRP slopes downward, forcing demand to rise.
b. The MRP and demand curves are the same.
c. MRP slopes downward, pushing demand toward equilibrium.
d. MRP crosses the demand curve at its lowest point.
b. The MRP and demand curves are the same.
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Indicate whether the statement is true or false
Imposition of an output tax on all firms in a competitive industry will result in
A) a downward shift in each firm's marginal cost curve. B) a downward shift in each firm's average cost curve. C) a leftward shift in the market supply curve. D) the entry of new firms into the industry. E) higher profits for the industry as price rises.