A firm's supply curve for labor: A) is vertical for a firm in perfect competition. B) is the same thing as the MRP_L for a firm in perfect competition. C) and the firm's MRP_L will determine the profit-maximizing quantity of labor hired by the firm in perfect competition. D) is the same as its demand curve for labor.

Question

Quizplus · Accepted Answer

The firm's supply curve for labor, in conjunction with its Marginal Revenue Product of Labor (MRPL), determines the profit-maximizing quantity of labor hired by the firm in perfect competition. The MRPL reflects the additional revenue a firm earns from hiring one more unit of labor, guiding firms in their hiring decisions.

A Firm's Supply Curve for Labor