Question\begin{tabular}{|l|l|l|}
\hline Unit of Labor & Total Product & Product Price \\
\hline 0 & 0 & \\
\hline 1 & 15 & 2.00 \\
\hline 2 & 28 & 1.80 \\
\hline 3 & 39 & 1.60 \\
\hline 5 & 58 & 1.40 \\
\hline 6 & 65 & 1.20 \\
\hline
\end{tabular}
The data in the table reveal that
(A) the firm is selling its product in a purely competitive market.
B the firm is hiring labor in an imperfectly competitive market.
(C) there is no level of output at which this firm can operate at a profit.
D the firm is selling its product in an imperfectly competitive market.
Studdy Solution
In a purely competitive market, the product price remains constant regardless of the quantity produced. In this case, the product price decreases as output increases, indicating that the firm has some control over the price, which is characteristic of an imperfectly competitive market.
The correct interpretation based on the data is:
(D) the firm is selling its product in an imperfectly competitive market.
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