Author Question: Suppose a firm uses land, labor, and capital for its production process. If it is renting the ... (Read 35 times)

ts19998 · **on:** Jun 29, 2018

Suppose a firm uses land, labor, and capital for its production process. If it is renting the equilibrium quantity of all three factors of production, then which of the following conditions will hold?

A) Marginal product from the last dollar spent on land = Marginal product from last dollar spent on labor > Marginal product from the last dollar spent on capital
B) Marginal product from the last dollar spent on land > Marginal product from last dollar spent on labor > Marginal product from the last dollar spent on capital
C) Marginal product from the last dollar spent on land > Marginal product from last dollar spent on labor = Marginal product from the last dollar spent on capital
D) Marginal product from the last dollar spent on land = Marginal product from last dollar spent on labor = Marginal product from the last dollar spent on capital

Question 2

Macroeconomics is the study of aggregate variables such as national production and unemployment.

Indicate whether the statement is true or false