In Constructing the Monopolist's Input Demand Curve, Which of the Statements

question 116

Multiple Choice

In constructing the monopolist's input demand curve, which of the statements is FALSE?

• A) The demand curve has a negative slope due to the law of diminishing marginal product.
• B) Marginal revenue is always positive.
• C) A monopoly restricts output and hires fewer units of labor than a perfectly competitive firm.
• D) The supply curve a monopoly faces is horizontal because the monopoly is a price taker.

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Definitions:

Accounts Payable

Accounts payable are amounts a company owes to suppliers for items or services purchased on credit; it is a current liability on the balance sheet.

Nominal Annual Cost

The cost of a product or service stated in current year prices without adjusting for inflation or deflation.

Trade Credit

A type of commercial financing where suppliers allow customers to purchase goods or services and pay for them at a later date.

Purchase Date

The date on which an asset or security was bought.