Solved

A Firm Decides to Hire More Equipments If

Question 1

Multiple Choice

A firm decides to hire more equipments if:


A) the average revenue it earns by selling its output is equal to its average cost.
B) its total revenue is greater than the total cost of hiring the equipments.
C) the marginal revenue product of the additional unit of capital is greater than the marginal factor cost.
D) its average revenue is greater than the average cost of hiring equipments.
E) the price of its product is greater than the average cost of production.

Correct Answer:

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