A condition for the profit-maximizing use of any factor of production is (where MP = marginal product,w = the price of a factor of production,p = price of one unit of the firm's output,MR = marginal revenue,MC = marginal cost,MRP = marginal revenue product):
A)MRP = MP × p
B)MR =
C)MC = MR × w
D)w = MP × p
E)MRP = MR × MC

Question

A condition for the profit-maximizing use of any factor of production is (where MP = marginal product,w = the price of a factor of production,p = price of one unit of the firm's output,MR = marginal revenue,MC = marginal cost,MRP = marginal revenue product):
A)MRP = MP × p 
B)MR = 
C)MC = MR × w 
D)w = MP × p 
E)MRP = MR × MC

Quizplus · Accepted Answer

The Answer of A condition for the profit-maximizing use of any factor of production is (where MP = marginal product,w = the price of a factor of production,p = price of one unit of the firm's output,MR = marginal revenue,MC = marginal cost,MRP = marginal revenue product):
A)MRP = MP × p 
B)MR = 
C)MC = MR × w 
D)w = MP × p 
E)MRP = MR × MC

A Condition for the Profit-Maximizing Use of Any Factor of Production