If MPK = r, the firm:
A) should hire more labor
B) should hire more capital until MPK= w
C) should hire more capital until MPK = 0
D) should get rid of some capital until MPK = r
E) has the optimal amount of capital
Correct Answer:
Verified
Q40: Figure 4.3: The Production Function
Q44: If Q45: Suppose the payments to capital and Q46: If MPK > r, the firm: Q48: The solution to the firm's profit maximization Q50: If MPL < w, the firm: Q51: Figure 4.4: Labor Market Q53: In the Cobb-Douglas production function Q54: Suppose the payments to capital and Q55: In models with perfect competition:
A) should
A) has
A) economic profits
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