Question 6 (1 point) The marginal revenue product curve of a purely competitive

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Question 6 (1 point)

The marginal revenue product curve of a purely competitive seller declines solely because of the law of diminishing returns.

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Question 7 (1 point)

It will be profitable for a firm to hire additional units of any resource up to the point at which its MRP is equal to its MRC.

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Question 8 (1 point)

The demand for a resource depends on its productivity and the market value(or price) of the product it is producing.

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Question 9 (1 point)

Marginal resource (labor) cost will exceed the wage rate when there is imperfect competitive in the hire of labor.

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Question 10 (1 point)

The rising general level of real wages in the United States has occurred because growing population has increased the supply of labor relative to the demand for it.

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Explanation / Answer

6. True. In case of perfect competition all the firms are price taker that is no firm is having market power. Thus, price is constant.

7. True. It will be profitable for the firm up to that unit of labor where MRP=MFC because additional unit of labor is having marginal revenue equal to marginal cost of hiring labor.

8. True. When price of a product increases the demand of input too increases.

9. True.

10. False.

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