To maximize profit, a firm O A. uses the quantity of land at which the rental rate equals the value of marginal product of land OB. uses the quantity of capital at which the suppliers' expected profit equals the value of marginal product of capital OC. uses the quantity of capital at which the marginal revenue equals the value of marginal product of capital OD. balances the rental rate of capital against the wage rate of labor

To maximize profit, a firm O A. uses the quantity of land at which the rental rate equals the value of marginal product of land OB. uses the quantity of capital at which the suppliers' expected profit equals the value of marginal product of capital OC. uses the quantity of capital at which the marginal revenue equals the value of marginal product of capital OD. balances the rental rate of capital against the wage rate of labor

ECON MICRO

5th Edition

ISBN:9781337000536

Author:William A. McEachern

Publisher:William A. McEachern

Chapter7: Production And Cost In The Firm

Section: Chapter Questions

Problem 3.9P

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Similar questions

What are the factor payments for land, labor, and capital?
What is the relationship between marginal product and marginal cost? (Hint: Look at the curves.) Why do you suppose that is? Is this relationship the same in the long run as in the short run?
A common name for fixed cost is overhead. If you divide fixed cost by the quantity of output produced, you get average fixed cost. Supposed fixed cost is 1,000. What does the average fixed cost curve look like? Use your response to explain what spreading the overhead means.
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