It is always rational to acquire more information before making a decision

What is an indifference curve? Can two indifference curves intersect? Explain your answer

What will be an ideal response?

Answer the question on the basis of the following information: Suppose a firm hires both labor (L) and capital (C) under purely competitive conditions. The price of labor is P L and that of capital is P C . The marginal product of labor is MP L and that

of capital is MP C . The firm sells its product competitively at a price of P X . Refer to the given information. If MP C /P C > MP L /P L , the firm: A. may be maximizing profits, but it is not minimizing costs. B. may be minimizing costs, but it is not maximizing profits. C. is neither minimizing costs nor maximizing profits. D. is minimizing costs and maximizing profits.