1. Which of the following is(are)true

a.The demand for factor(say labor,capital)is a derived demand.That is,the demand for a factor depends upon the demand for the product that the factor produces

b.According to marginal productivity theory,the price paid to a factor input(marginal factor cost to the firm) depends upon the factor's contribution(Marginal revenue product) to the revenue of the firm

c.Both are True

2.Which of the following has beenan example of natural monopoly?

Public utilities, such as electricity , local telephone service, and cable TV

a market for breakfast cereals

a market for cold medicines

a market for cigarettes

3.Select the correct statement(s).

a.Marginal Revenue product of a factor(say labor) is defined asthe addition to total revenue of the firm as a result of a unit change in the factor quantity

b.Marginal revenue product curve of a factor is downward sloping curve

c.An increase in factor's productivity(Marginal product)due to technological advanceswill shift the demand for the factor to the right

d.All of the above are correct

e.All 'A' , 'B' and 'C' are correct