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One Baker Can Bake 15 Pies in a Day

Question 8

Multiple Choice

One baker can bake 15 pies in a day.Two bakers can bake 35 pies in a day.If the marginal revenue product of hiring the second baker is $200,then in a perfectly competitive product market


A) each pie sells for $10.
B) there are diminishing marginal returns.
C) there are decreasing economies of scale.
D) they are operating in a constant cost industry.
E) the marginal cost of production is $200.

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