The profit-maximizing rule for a firm hiring both labor (L) and capital (C) under conditions of imperfect competition is
A) $\mathrm { MP } _ { L } / \mathrm { P } _ { L } = \mathrm { MP } C / \mathrm { P } C$
B)$\mathrm{MP}_{L} / \mathrm{MP}_{C}=\mathrm{MRC}_{C} / \mathrm{MRP}_{L}$
C) $\mathrm{MRP} L / \mathrm{MRC} L=\mathrm{MRP} C / \mathrm{MRC} C=1 .$
D) $\mathrm { MRC } _ { L } / \mathrm { MP } _ { L } = \mathrm { MRC } _ { C } / \mathrm { MP } _ { C } = 1$

Question

Quizplus · Accepted Answer

The profit-maximizing condition for a firm in imperfect competition is to equate the marginal revenue product (MRP) to the marginal resource cost (MRC) for both labor and capital.

The Profit-Maximizing Rule for a Firm Hiring Both Labor (L) MPL/PL=MPC/PC\mathrm { MP } _ { L } / \mathrm { P } _ { L } = \mathrm { MP } C / \mathrm { P } CMPL​/PL​=MPC/PC

The Profit-Maximizing Rule for a Firm Hiring Both Labor (L) $\mathrm { MP } _ { L } / \mathrm { P } _ { L } = \mathrm { MP } C / \mathrm { P } C$