Which of the Following Statements Is True

question 49

Multiple Choice

Which of the following statements is true?

• A) If MFCL < MRPL the firm should hire more labor.
• B) If the MFCL > MRPL the firm should hire more labor.
• C) If the MFCL = MRPL the firm should hire more labor.
• D) If MFCL > 0, the firm should shut down.

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Definitions:

Equilibrium Price

The price at which the quantity of a product demanded by consumers equals the quantity supplied by producers.

Equilibrium Quantity

The amount of goods or services supplied and demanded at the equilibrium price, where the quantity demanded equals the quantity supplied.

Number of Firms

The total count of businesses operating within a market or industry, a key factor in determining market structure and competition levels.

Downsloping Demand

A situation where demand decreases as the price increases, typically illustrated by a downward sloping demand curve.