Question: What should the firm do? (A) Increase capital and decrease labor so that the marginal product of capital falls and the marginal product of labor

What should the firm do?

(A) Increase capital and decrease labor so that the marginal product of capital falls and the marginal product of labor rises.

(B) Increase capital and decrease labor so that the marginal product of capital rises and the marginal product of labor falls.

(C) Decrease capital and increase labor so that the marginal product of capital rises and the marginal product of labor falls.

(D) Decrease capital and increase labor so that the marginal product of capital falls and the marginal product of labor rises.

(E) Increase both capital and labor until the ratio of marginal products per dollar is equal.

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