When Costs Are at a Minimum

question 7

Multiple Choice

When costs are at a minimum,

• A)the ratio of the MP_L/MP_K < Price L/Price K.
• B)MP_L = MP_K.
• C)the extra output we get from the last dollar spent on an input must be the same for all inputs.
• D)Price L = Price K.

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Definitions:

Markup

The amount added to the cost price of goods to cover overhead and profit; expressed as a percentage of the cost.

Selling Price

The amount of money a buyer pays to purchase an item from a seller.

Trade Advertising

Advertising directed towards professionals within a specific industry, as opposed to general consumers, to promote products or services.

Retail Advertising

Marketing efforts aimed at generating interest and sales among end consumers directly through various media channels.