The equation shows that both the hiring and output choices of the firm follow the same rule:inputs or output are chosen so that marginal revenue(from the sale of output)is equal to marginal cost(from the purchase of inputs).This principle holds (in both competitive and noncompetitive markets.The equation shows that both the hiring and output choices of the firm follow the same rule: inputs or output are chosen so that marginal revenue (from the sale of output) is equal to marginal cost (from the purchase of inputs).This principle holds (适用) in both competitive and noncompetitive markets