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That the perfectly competitive firm will pick a combination of inputs where the ratio ofeach input’s marginal product to its price is equal follows from

Question:

That the perfectly competitive firm will pick a combination of inputs where the ratio ofeach input’s marginal product to its price is equal follows from

A.

the need to use inputs in fixed proportions

B.

the backward bending supply curve of labour

C.

cost minimization

D.

the attempt to achieve a target rate of return

Answer» c. cost minimization

Note: The above multiple-choice question is for all general and Competitive Exams in India