A Profit Maximizing Monopsonist Chooses Aggregate Quantity of Input So

question 86

Multiple Choice

A profit maximizing monopsonist chooses aggregate quantity of input so that:

• A)price equals marginal factor cost.
• B)marginal factor cost equals aggregate output price.
• C)marginal revenue product equals aggregate marginal factor cost.
• D)output price equals marginal revenue.

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Definitions:

Direct Materials

Direct materials are raw inputs that are directly consumed in the manufacturing process of a product and can be directly attributed to that product.

Direct Labor

The labor cost of workers directly involved in the production of goods or services.

Process Costing

An accounting methodology that traces and accumulates direct costs, and allocates indirect costs, of a manufacturing process, costing each process separately.

Equivalent Units

A concept in cost accounting used to allocate costs to partially completed goods, converting them into the amount of finished goods units that could have been produced with those costs.