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makalisek makalisek
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8 months ago

Why does the marginal revenue product (MRP) curve slope downward for a perfectly competitive firm?



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Because MRP = MR x MPP.  After some point, as more of a factor is employed, the lower its MPP is; thus MRP declines.



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Because MRP = MFC x MPP. After some point, as more of a factor is employed, the lower its MFC is; thus MRP declines.



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Because MRP = MR x MPP. After some point, MR declines for a product price taker; thus, MRP declines.



▸

Because MRP = MFC x MR. After some point, MFC and MR decline; thus, MRP declines.

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Economics

Economics


Edition: 12th
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JulzMarieJulzMarie
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8 months ago
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