Assume that an appliance manufacturer is employing variable resources X and Y in such amounts that the MRPs of the last units of X and Y employed are $50 and $90, respectively. Resource X can be hired at $100 per unit and resource Y at $40 per unit. The firm
A) should hire less of X and more of Y.
B) should hire more of both X and Y.
C) is producing with the least-costly combination of X and Y but could increase its profits by employing more of X and less of Y.
D) is using the least-costly combination of X and Y but could increase its profits by employing less of both X and Y.
Correct Answer:
Verified
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