In the One-Input Model, Profit Is Always Maximized Where Marginal

question 9

True/False

In the one-input model, profit is always maximized where marginal revenue product is equal to the input price.

---

Definitions:

Internal Rate

Often refers to the internal rate of return (IRR), which is a metric used to evaluate the profitability of potential investments.

Minimum Required

The least amount or level needed for a specific purpose, such as the minimum required investment or stock balance.

Net Present Value

The difference between the present value of an investment project’s cash inflows and the present value of its cash outflows.

Discount Rate

The interest rate used to discount future cash flows to present value, often reflecting the cost of capital or risk level.