For a Profit-Maximizing Firm That Is a Price Taker in the Output

question 8

Multiple Choice

For a profit-maximizing firm that is a price taker in the output market and a wage taker in the
Labor market,which of the following will be true?

• A)The marginal revenue product will be higher than the marginal value product.
• B)The marginal cost of labor must be lesser than the price of output.
• C)The marginal value product of labor will equal the wage rate.
• D)The marginal revenue from an extra unit sold will be higher than price.

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Definitions:

Progressive Income Tax

A tax system in which the tax rate increases as the taxable income increases, imposing higher rates on those with higher incomes.

Taxation

The process by which a government levy charges on citizens or corporate entities to finance government spending and activities.

Sales And Excise Taxes

Taxes placed on the sale or manufacture of goods and services, collected by the government.

Products

Goods or services that are created through a process and offered in the market to satisfy customer needs or desires.