According to the marginal productivity theory of income distribution,in a competitive economy each factor of production is paid its equilibrium value of the marginal product.

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The marginal productivity theory of income distribution states that in a competitive economy, each factor of production is paid its equilibrium value of the marginal product. This means that the factors of production, such as labor and capital, are compensated based on their contribution to the production process. In other words, the more productive a factor is, the more income it generates.

According to the Marginal Productivity Theory of Income Distribution,in a Competitive