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A Firm Will Be Hiring Labor and Capital in Profit-Maximizing

Question 242

Multiple Choice

A firm will be hiring labor and capital in profit-maximizing amounts when


A) MRP capital/price of capital equals MRP labor/price of labor.
B) MRP capital/MRP labor equals price of labor/price of capital.
C) MRP capital/price of capital equals MRP labor/price of labor equals 1.
D) the MRP of the last unit hired of both labor and capital are the same.

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