AP Microeconomics Unit 5 Practice Test

If for two resources, labor (L) and capital (K), the ratios of their marginal physical products are the firm should:

hire more labor (L) and use less capital until the ratios are equal. A decrease in supply of the good pay less and hire fewer workers than a perfectly competitive market Increase the amount of capital and decrease labor

Correct Answer:

hire more labor (L) and use less capital until the ratios are equal.

Explanation:

Correct answer: hire more labor (L) and use less capital until the ratios are equal.

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