Assuming a firm is selling its output in a purely competitive market, its resource demand curve can be determined by
A)multiplying total product by product price.
B)multiplying marginal product by product price.
C)dividing total revenue by marginal product.
D)comparing marginal product with various possible input prices.

Question

Quizplus · Accepted Answer

The resource demand curve for a firm in a purely competitive market is determined by multiplying the marginal product of a resource by the price of the product it helps produce. This reflects the additional revenue generated by employing one more unit of the resource.

Assuming a Firm Is Selling Its Output in a Purely