The Following Table Shows Total Output Produced by Different Units

question 11

Multiple Choice

The following table shows total output produced by different units of capital.Table 14.3
The marginal revenue product of a resource is the product of the marginal product of the resource and the marginal revenue.
-Consider a perfectly competitive firm that produces computers. Each additional worker at this firm can produce four computers. Calculate the marginal factor cost if the computers are sold for $1,000 each, and the firm is maximizing profit. (Assume that marginal revenue product is the product of marginal product of the input and the marginal revenue of the firm.)

• A)$4,000
• B)$500
• C)$1,000
• D)$1,500
• E)$400

Explain the conditions under which resources are efficiently allocated in competitive markets.

Understand the impact of new firm entry and exit on market equilibrium and economic profits in a competitive price-taker market.

Identify the factors driving firms to enter or exit the market.

Recognize the role of economic profits and losses in resource allocation and market signals.

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