Which of the Following Is False

question 89

Multiple Choice

Which of the following is false?

• A) If a firm is a factor price taker, marginal factor cost is constant and equal to factor price. This means a factor price taker pays a wage equal to its marginal factor cost.
• B) Firms hire the factor quantity at which marginal revenue product equals marginal factor cost.
• C) If a firm is a product price taker, marginal revenue product is greater than value marginal product.
• D) If a firm is product price taker and a factor price taker, it pays labor a wage equal to its value marginal product.

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Definitions:

Sale Or Return

A contract in which the seller delivers a quantity of goods to the buyer on the understanding that if the buyer desires to retain, use, or sell any portion of the goods, he will consider such part as having been sold to him, and that he will return the balance or hold it as bailee for the seller.

Risk Of Loss

Refers to the legal responsibility regarding who bears the cost of damage, destruction, or theft of goods during a transaction or after it, until delivery.

F.O.B. Seattle

A commercial term indicating that the seller of goods is responsible for them until they are loaded on board a shipping vessel in Seattle, at which point the buyer assumes risk and responsibility.

Shipment Contract

A type of agreement in sales law where the seller is responsible for delivering goods to a carrier, after which the risk of loss passes to the buyer.