Asked by Zachary Wages on Apr 28, 2024
Verified
A firm's ________ curve in a perfectly competitive product market is the same as its supply curve. Similarly, a firm's ________ curve in a perfectly competitive labor market is the same as its demand curve.
A) marginal revenue product; marginal cost
B) marginal cost; marginal revenue product
C) total revenue; total cost
D) total cost; total revenue
Marginal Revenue Product
The additional revenue generated by employing one more unit of a resource or input.
Marginal Cost
The additional cost of producing one more unit of a good or service.
- Recognize the linkage between the functioning of product markets and outcomes in the labor markets.
Verified Answer
AK
ABDULAZIZ KHALID ABDULAZIZMay 03, 2024
Final Answer :
B
Explanation :
In a perfectly competitive product market, a firm's marginal cost curve above the shutdown point acts as its supply curve because it decides the quantity of output to produce based on marginal costs. In a perfectly competitive labor market, a firm's marginal revenue product curve is its demand curve for labor, as it shows the additional revenue generated from hiring one more unit of labor.
Learning Objectives
- Recognize the linkage between the functioning of product markets and outcomes in the labor markets.
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