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    Microeconomics Study Set 2
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    Exam 17: The Markets for Labor and Other Factors of Production
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    Let MP = Marginal Product, P = Output Price, and W
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Let MP = Marginal Product, P = Output Price, and W

Question 14

Question 14

Multiple Choice

Let MP = marginal product, P = output price, and W = wage, then the equation that represents a situation where a competitive firm should lay off some workers to maximize profits is


A) P × MP = W.
B) P × MP > W.
C) P × MP < W.
D) MP × W = P.

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