For a perfectly competitive firm, profit is maximized at the output level where i. total revenue exceeds total cost by the largest amount. ii. marginal revenue equals marginal cost. iii. price equals marginal cost

If the multiplier = 2.5, the MPS would be

A) 0.25. B) 0.4. C) 0.6. D) 0.75.

Assume that a company is producing at a point beyond where diminishing returns has already set in. If the firm cuts back on production what would you expect should happen to the marginal product of labor and why?

What will be an ideal response?