2010-02-13_020622_Eco

2010-02-13_020622_Eco - A firm that is motivated by self...

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A firm that is motivated by self interest should: A. employ the combination of resources that will produce the profit-maximizing output at the minimum cost . B. always use large amounts of cheap inputs and small amounts of expensive inputs in producing its output. C. hire each input so the productivity of each is equal at the margin. D. always use large amounts of the most productive inputs and small amounts of the least productive inputs in producing its output. 8) If a profit-seeking competitive firm is producing its profit-maximizing output and its total fixed costs fall by 25 percent, the firm should: A. use more labor and less capital to produce a larger output. B. increase its output . C. not change its output. D. reduce its output. 9) If a firm in a purely competitive industry is confronted with an equilibrium price of $5, its marginal revenue: A. may be either greater or less than $5. B. will be greater than $5. C. will also be $5.
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