Which of the Following Is True of Marginal Revenue Product

question 196

Multiple Choice

Which of the following is true of marginal revenue product (MRP) and marginal product (MP) ?

• A)MRP = MP ´ price, whether the firm is a price searcher or not.
• B)MRP = MP ´ price only if the firm is a price searcher.
• C)MRP = MP ´ price only if the firm sells in a perfectly competitive market.
• D)MRP = MP ´ marginal cost only if the firm is a price searcher.
• E)MRP = MP/price only if the firm is a price taker.

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Definitions:

Mercantilism

An economic theory and practice where government regulation of a nation's economy is used to increase state power at the expense of rival national powers.

Laissez-faire

Laissez-faire is an economic philosophy advocating minimal governmental intervention in the marketplace and the economic activities of individuals and businesses.

Precious Metals

Metals of high economic value, often used as an investment or industrial commodity, including gold, silver, platinum, and palladium.

Deficit Financing

The practice of funding government spending by borrowing rather than from taxation or savings, often leading to a budget deficit.