Marginal Revenue Product Can Be Calculated Using the Formula Marginal

question 32

Multiple Choice

Marginal revenue product can be calculated using the formula marginal product × output price

• A)only if output price is constant.
• B)only if the marginal product of labor is constant.
• C)only if the both marginal product of labor and the output price are constant.
• D)only if the firm has market power in the labor market

---

Definitions:

Inefficient

A state where resources are not optimally allocated, often resulting in wasted resources or outputs that do not maximize potential value.

Monopolistically Competitive

Describes a market structure where many companies sell products that are substitutes, but are not perfect substitutes, leading to some degree of market power for each firm.

Barriers to Entry

Obstacles that make it difficult for new competitors to enter a market, such as high startup costs or strict regulations.

Product Differentiation

The process of distinguishing a product from others in the market to make it more attractive to a particular target market.