If the Interest Rate at Which a Firm Can Borrow

question 124

Multiple Choice

If the interest rate at which a firm can borrow or lend is 10 percent, then the firm will own

• A)all units of capital with a marginal revenue product below 10 percent.
• B)all units of capital with a marginal revenue product above 10 percent.
• C)all units of capital with an average revenue product below 10 percent.
• D)all units of capital with an average revenue product above 10 percent.
• E)no capital at all.

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