If a firm fired one worker and lost 12 units of production and decides to add one more unit of capital, then to remain on the same isoquant what must be TRUE?
A) The MPK of the next unit of capital added equals 12.
B) The firm must force the other workers to work more.
C) The firm will experience a decline in output.
D) The marginal rate of technical substitution is greater than 12.
A
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Which of the following statements about the history of inflation in the U.S. is true?
a. Inflation averaged roughly 2% from 1950-19-65, but has fallen since then. b. Inflation has averaged roughly 2% since 1950. c. Inflation averaged roughly 2% from 1950-1965, rose until the early 1980s, and has fallen slowly since. d. Inflation has gradually climbed since the 1950s.
Which of the following best describes the market reaction if a city restricts the number of firms that are allowed to operate in a market?
A) The market supply curve shifts to the left. B) The market demand curve shifts to the left. C) Quantity supplied increases because price increases. D) Price decreases.