For a price taker,if the price of a variable factor of production increases,

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As a price taker, the firm cannot affect the price of the goods it sells. Therefore, an increase in the price of a variable factor of production (such as labor or raw materials) raises the marginal cost of producing each additional unit of output. This means that the profit-maximizing level of output will decrease, as the firm will want to produce less in order to avoid incurring higher costs.

For a Price Taker,if the Price of a Variable Factor