A firm that wants to maximize profits should hire each input to the point where
A) its marginal revenue product divided by the price of the input equals one.
B) its marginal revenue product divided by its marginal physical product equals the wage.
C) its marginal revenue product divided by the product price equals one.
D) its marginal physical product divided by the price of the input equals the product price.
Answer: A
Economics
You might also like to view...
The term "transportation revolution" implies:
a. binding the East and West politically. b. binding the East and West economically. c. rapidly introduced technological innovations. d. All of the above are implied.
Economics
When average variable cost is at its minimum, it is equal to the marginal cost of production at that level of output
Indicate whether the statement is true or false
Economics