Which of the following represents a perfectly competitive farmer's demand curve for hired hands?
A)her ATC curve
B)her AVC curve
C)her MRP curve
D)her MRC curve
E)her AFC curve

Question

Quizplus · Accepted Answer

In a perfectly competitive market, the demand curve for a factor of production, such as hired hands, is equivalent to the marginal revenue product (MRP) curve. The MRP curve shows the additional revenue earned by the farmer for each additional unit of hired labor, and as the farmer hires more labor, the MRP curve will slope downwards. Therefore, the answer is C.

Which of the Following Represents a Perfectly Competitive Farmer's Demand