A resource price taker's resource demand curve is
A)horizontal
B)the same as its marginal resource cost curve
C)the same as its marginal revenue product curve
D)the same as its marginal product curve
E)the same as its average variable cost curve

Question

Quizplus · Accepted Answer

A resource price taker's resource demand curve is the same as its marginal revenue product curve. This is because the firm can sell all of its output in the market at the market price, and thus the additional revenue generated by hiring one more unit of the resource is equal to the marginal revenue product.

A Resource Price Taker's Resource Demand Curve Is