Which of the following is (are) true?
A) To assess a firm's demand for capital we must determine the present value of marginal revenue products and marginal factor costs of capital.
B) A firm maximizes profit in the hiring of capital when the MRP of capital is greater than the MFC of capital.
C) A firm should hire less capital if the MRP of capital is greater than the MFC of capital.
D) A and B are true.
Correct Answer:
Verified
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