Marginal revenue product is increasing as
A)the marginal physical product is increasing, other things equal.
B)the amount of time is increasing, other things equal.
C)the revenue from sales decreases, other things equal.
D)the revenue from one more unit produced falls, other things equal.

Question

Quizplus · Accepted Answer

Marginal revenue product measures the increase in revenue from hiring one additional unit of labor. It is calculated as the marginal physical product (increase in output from hiring one more unit of labor) multiplied by the marginal revenue (the additional revenue earned from selling that output). Therefore, if the marginal physical product is increasing, marginal revenue product will increase as well.

Marginal Revenue Product Is Increasing as