If the Marginal Product of Capital Is Greater Than the Rental

question 51

Multiple Choice

If the marginal product of capital is greater than the rental cost of capital in terms of goods and services, then ________.

• A) the firm should continue to produce using that same amount of capital.
• B) the firm should add additional capital.
• C) the firm should reduce the amount of capital is is using.
• D) diminishing returns have been avoided

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Definitions:

Disarmament Chamber

A facility or area designated for the dismantling or neutralization of military weapons and munitions.

Discharge Valves

Components in a system that allow for the controlled release of substances (gas, liquid, etc.) from a pressure vessel or system.

Rings Passing

A condition in an engine when the piston rings do not properly seal, allowing oil or fuel to pass into the combustion chamber.