The Demand for Resources
In this lesson, you will learn how to:
- explain how the marginal revenue productivity of a firm resource relates to a firm’s demand for that resource
- list the factors that increase or decrease resource demand.
- explain how marginal revenue product and marginal resource cost can be used to find the profit-maximizing quantity of a resource (such as labor) purchased by a firm
- calculate the profit-maximizing quantity of a resource (such as labor) purchased by a firm
- determine how a competitive firm selects its optimal combination of resources