Which of the Following Statements Regarding Equilibrium in the Markets

question 109

Multiple Choice

Which of the following statements regarding equilibrium in the markets for capital and for a natural resource used in producing a good is true?

• A)The marginal revenue product of capital will equal the marginal revenue product of the natural resource.
• B)The rental price of capital will equal the price of the natural resource.
• C)The marginal product of capital will equal the rental price of capital and the marginal product of the natural resource will equal the price of the natural resource.
• D)The marginal revenue product of capital will equal the rental price of capital and the marginal revenue product of the natural resource will equal the price of the natural resource.

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Definitions:

Economic Profit

The financial difference resulting from deducting both visible and hidden costs from total revenue.

Profit-Maximizing Level

The point at which a business achieves its highest level of profit with its current resources and market conditions.

Economic Profit

The gap highlighted by the difference in total income and total outgoings, including every cost, for a company.

Monopolistically Competitive

A monopolistically competitive market structure is characterized by many firms offering differentiated products or services, allowing for some degree of market power and pricing over their unique products.