A Perfectly Competitive Firm Discovers That Its $\mathrm { MRP } _ { L }$

question 266

Multiple Choice

A perfectly competitive firm discovers that its $\mathrm { MRP } _ { L }$ divided by the wage equals 1.25.The firm should

• A)check the MRP of the other inputs and divide them by their prices.If they are all equal to 1.25 it is maximizing profits.
• B)hire more labor.
• C)purchase more capital.
• D)try to pay a lower wage rate.

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Definitions:

Reconstruction Policy

The set of strategies implemented by the U.S. government from 1865 to 1877 aimed at rebuilding and reintegrating the Southern states after the Civil War and addressing the status of the freed slaves.

Equal Protection

A principle under the Fourteenth Amendment of the U.S. Constitution guaranteeing that no state will deny any person within its jurisdiction the equal protection of the laws.

Amendment

A formal change or addition to a legal or statutory document.

Reconstruction Plan

Relates to the strategies and policies implemented to rebuild and reorganize the Southern United States after the Civil War.