Marginal revenue product is obtained by multiplying the price of the product by the marginal resource cost.
a. True
b. False
QUESTION 2Suppose environmental groups pressure the local government to reduce the number of pollution rights to be sold. Other things equal,
a. pollution would not be affected
b. the price of pollution rights would rise, and the amount of pollution would decrease
c. the price of pollution rights would fall, and the amount of pollution would decrease
d. the price of pollution rights would fall, and the amount of pollution would increase
e. the price of pollution rights would rise, and the amount of pollution would increase
QUESTION 3The marginal revenue product curve represents a firm's demand curve for a resource.
a. True
b. False
QUESTION 4Other things equal, if the government increased the quantity of pollution rights to be sold,
a. pollution would not be affected
b. the price of pollution rights would rise, and the amount of pollution would decrease
c. the price of pollution rights would fall, and the amount of pollution would decrease
d. the price of pollution rights would fall, and the amount of pollution would increase
e. the price of pollution rights would rise, and the amount of pollution would increase
QUESTION 5Marginal revenue product of labor equals marginal product times the wage only when the firm is a perfect competitor in the product market.
a. True
b. False
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