Explain what the profit-maximizing combination of resources is for the perfectly competitive firm
What will be an ideal response?
The firm hires each input such that the marginal revenue product of the input equals the price of the input. This can also be expressed as: (MRP of labor/Price of labor) = (MRP of capital/Price of capital) = (MRP of land/Price of land), and so on.
Economics
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In order to be successful as an innovator, a firm may require:
a. constant investment in mergers and acquisitions. b. frequent expansion of its scale of operation. c. to invest the majority of its annual profit in market research. d. research facilities and a culture that respects scientists and engineers.
Economics
The problem of double coincidence of wants is associated with: a. paper money. b. insurance
c. credit cards. d. barter system.
Economics