If the Marginal Product of Labor Is 100 and the Price

question 24

Multiple Choice

If the marginal product of labor is 100 and the price of labor is 10,while the marginal product of capital is 200 and the price of capital is $30,then what should the firm?

• A) The firm should use relatively more capital
• B) The firm should use relatively more labor
• C) The firm should not make any changes - they are currently efficient
• D) Using the Equimarginal Criterion,we can't determine the firm's efficiency level
• E) Both c and d

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