The Shape of the Marginal Revenue Product Curve for a Perfectly

question 110

Multiple Choice

The shape of the marginal revenue product curve for a perfectly competitive firm would be ________ its marginal product curve because ________.

• A)the same as; MR is constant as output increases
• B)steeper than; MR decreases as output increases
• C)steeper than; its product's price increases as output increases
• D)flatter than; its product's price decreases as output increases
• E)flatter than; it must pay a higher wage to the variable factor as output increases

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Definitions:

Machine-Hours

A measure of production time, describing how many hours a machine is in operation.

Job-Order Costing

A cost accounting system that accumulates costs per job rather than by process, suitable for firms producing unique products or jobs.

Plantwide Predetermined

A single predetermined overhead rate that is applied throughout an entire plant or manufacturing facility.

Machine-Hours

A measure of the amount of time that a machine is operated, used as a basis for allocating manufacturing overhead costs in traditional costing systems.