The Figure Given Below Shows the Marginal Revenue Product (MRP)

The figure given below shows the marginal revenue product (MRP) of accountants in a firm. Figure 14.2 MRP = MP ´ MR
According to Figure 14.2,the:

A) value of the resource to the firm declines after the second unit of the resource is used.
B) marginal-physical product diminishes at every resource level if we consider the product market to be competitive.
C) law of diminishing marginal product does not apply in this case.
D) optimal number of units of the resource to be used is 2.
E) optimal number of units of the resource to be used is 7.

Correct Answer:

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