Marginal revenue product (MRP) of labor refers to the:
A. increase in total revenue resulting from the sale of an additional unit of output.
B. amount by which a firm's total resource cost increases when it employs one more unit of
labor.
C. increase in total revenue resulting from the hire of one more unit of labor.
D. price at which additional units of labor can be employed in a monopsonized labor market.
Answer: C. increase in total revenue resulting from the hire of one more unit of labor.
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Fixed inputs are those whose
a. quantity changes as the level of output changes b. costs are irreversible c. quantity remains constant regardless of the level of output d. quantity determines the level of profit e. appearance was damaged while being transported, but has been fixed
For each watch Denmark produces, it gives up the opportunity to make 50 pounds of cheese. Germany can produce one watch for every 100 pounds of cheese it produces. Which of the following is true with regard to opportunity costs in the two countries?
a. The opportunity cost of producing watches is higher in Denmark. b. The opportunity cost of producing cheese is higher in Denmark. c. The opportunity cost of producing cheese is identical in both countries. d. It is impossible to compare opportunity costs because the two countries use different currencies. e. In both countries combined, the opportunity cost of one watch is 150 pounds of cheese.