The theory of factor pricing is popularly known as
Theory of Distribution
Theory of Consumption
Theory of Supply
Theory of demand
Under perfect competition, a firm will employ more and more units of a factor so long as
MC = MR
HC = AC
MR is greater than MC
MC + MR
The demand curve for a factor is
A horizontal straight line
A vertical straight line
Negatively sloped line
Positively slopped line
Marginal revenue product curve is
An excess demand curve
A supply curve for a factor
A demand curve for a factor
Decrease demand curve
If a factor has many close substitutes, its elasticity of demand will be
Zero
High
Low
Constant
The wage fund theory is developed by
Ragnar Frisch
J.S. Mill
Keynes
Adam smith
The supply of labour in an economy at very high real wages
Increases
Decreases
Remains Constant
No change
According to modern theory rent arises when
Actual earning exceeds transfer earnings
Actual earning equal transfer earnings
Actual earning falls short of transfer earning
Actual earning decreases transfer earnings
If supply of a factor is perfectly inelastic the entire earning of the factor is
Quasi Rent
Transfer earning
Rent
Income
The demand for a factor is
A direct demand
A derived demand
An excess demand
Decreasing demand
