The formula for optimal employment of two resources, x and y, is A) MP_x - MP_y B) MRP_x = MRP_y C) MP_x $\times$ P_x = MP_y $\times$ P_y D) MRC_x = MRC_y E) MRP_x/MRC_x = MRP_y/MRC_y = 1

Question

Quizplus · Accepted Answer

The optimal employment of resources occurs when the marginal revenue product (MRP) to marginal resource cost (MRC) ratio is equal for both resources and equals 1, ensuring that each resource is contributing equally to profit maximization.

The Formula for Optimal Employment of Two Resources, X and Y