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A Firm Chooses Its Profit-Maximizing Quantity of Capital by

Question 208

Multiple Choice

A firm chooses its profit-maximizing quantity of capital by


A) comparing the marginal revenue product of capital with the rental price of capital.
B) comparing the price of capital with the price of labor.
C) examining the total cost of capital equipment.
D) determining the rate at which the firm can borrow funds to purchase plant and equipment.

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