- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 1. The Firm and Market Structures
- Subject 1. Supply Analysis: Cost, Marginal Return, and Productivity
CFA Practice Question
For a firm in perfect competition, as the quantity of labor increases, the marginal revenue product most likely diminishes, because of a decline in ______.
A. marginal product only
B. marginal revenue only
C. both marginal product and marginal revenue
Explanation: For a firm in perfect competition, as quantity of labor increases, marginal revenue product diminishes because marginal product diminishes.
User Contributed Comments 1
User | Comment |
---|---|
kingirm | in perfect competition price is flat |