"A producer wanting to employ optimal quantity of inputs should choose the point where diminishing returns set in."

Name: "A producer wanting to employ optimal quantity of inputs should choose the point where diminishing returns set in."
Brand: Quizplus
Rating: 4.7 (44 reviews)

Question

Quizplus · Accepted Answer

The correct rule is marginal revenue product = input price. It pays to go beyond diminishing returns so long as MRP is at least as great as input P, which normally requires going past the point of diminishing returns.

"A Producer Wanting to Employ Optimal Quantity of Inputs Should