If the marginal revenue product of capital for a profit-maximizing firm is $500 and the price of capital is $300, then
A) the firm will need to hire more capital in order to maximize profit.
B) the firm is not maximizing profit.
C) Not enough information is given to support the any of the choices.
D) the firm will need to hire less capital in order to maximize profit.
E) the firm is maximizing profit.
Correct Answer:
Verified
Q21: The equilibrium rental price of capital is
Q22: In a competitive market, the rental price
Q23: The demand curve for capital shows that
Q24: The demand for capital is
A)a final demand
Q25: The price of a good with a
Q27: What is the difference between financial capital
Q28: The equilibrium price of capital
A)is not affected
Q29: The profit-maximizing principle that marginal revenue product
Q30: The marginal revenue product of capital is
Q31: The demand for capital is a derived
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