If a Firm Uses Only Capital and Labor as Inputs

question 35

Multiple Choice

If a firm uses only capital and labor as inputs, then what should the firm do at a given rate of production if the marginal physical product of labor per last dollar spent is lower than the marginal physical product of capital per last dollar spent?

• A) The firm should increase both the quantity of capital and the quantity of labor.
• B) The firm should decrease both the quantity of capital and the quantity of labor.
• C) The firm should increase the quantity of capital and reduce the quantity of labor.
• D) The firm should decrease the quantity of capital and increase the quantity of labor.

Comprehend the dynamics and effects of leader-member exchange (LMX) relationships on organizational outcomes.

Recognize how leaders and subordinates can influence the quality of their LMX relationships.

Identify strategies leaders and subordinates use to maintain high-quality exchange relationships.

Differentiate between internal and external attributions made by leaders regarding subordinate performance.

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Definitions:

Market Demand Curve

A graphical representation showing the total quantity of a good or service that all consumers in a market are willing and able to purchase at various prices.

Demand Curves

Graphs showing the relationship between the price of a good and the quantity of that good that buyers are willing to purchase at various prices.

Goods

Tangible items that are produced for sale or use, often categorized as consumer or industrial goods.

Quantity Demanded

The total amount of a goods or services that consumers are willing and able to purchase at a given price level at a specific time.