Analysis
The following figure shows the marginal revenue product of a resource [MRP]:
Figure 14.1
![Analysis The following figure shows the marginal revenue product of a resource [MRP]: Figure 14.1 -Assume that the resource market shown in Figure 14.1 is perfectly competitive. The MRP curve for the resource is negatively sloped because: A) the firm can sell more units of a good only at lower prices. B) the marginal physical product curve for the resource is negatively sloped. C) the resource gives increasing returns as more of the resource is employed. D) the firm hires more units of the resource at a higher price. E) average productivity of the resource increases as more units of the resource are used.](https://d2lvgg3v3hfg70.cloudfront.net/TB1748/11ea8882_624e_f93c_8903_0931f536244f_TB1748_00_TB1748_00.jpg)
-Assume that the resource market shown in Figure 14.1 is perfectly competitive. The MRP curve for the resource is negatively sloped because:
A) the firm can sell more units of a good only at lower prices.
B) the marginal physical product curve for the resource is negatively sloped.
C) the resource gives increasing returns as more of the resource is employed.
D) the firm hires more units of the resource at a higher price.
E) average productivity of the resource increases as more units of the resource are used.
Correct Answer:
Verified
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Q21: The figure given below shows the marginal
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