A Decrease in the Price of a Firm's Output

question 354

Multiple Choice

A decrease in the price of a firm's output

• A) raises the value of marginal product of each unit of labor.
• B) shifts the firm's demand for labor curve rightward.
• C) results in the firm increasing the amount of output it produces.
• D) None of the above is correct.

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Definitions:

Watered Stock

Shares of a company that are issued at a value much greater than the assets of the company, leading to an inflation of the company's value on paper.

Fair Market Value

The price at which property would sell for on the open market between a willing buyer and a willing seller, both having reasonable knowledge of all relevant facts.

Corporate Opportunity

A business opportunity that a company must offer to its shareholders or members before taking it for personal gain.

Duty of Disclosure

The legal obligation to reveal all material facts or information relevant to a transaction or decision-making process.