The diagram below shows the MRP curve for a firm producing high school math textbooks. The factor of production being considered here is hours of labour. FIGURE 13- 2
-Refer to Figure 13- 2. Suppose this firm initially has the marginal revenue product curve MRP1. One reason that the curve could shift to MRP2 is
A) a decrease in the wage rate.
B) an increase in the quality of workers employed by the firm.
C) an increase in the supply of labour.
D) a decrease in demand for the firm's output, math textbooks.
E) a decrease in the market price of math textbooks.

Question

The diagram below shows the MRP curve for a firm producing high school math textbooks. The factor of production being considered here is hours of labour.  FIGURE 13- 2
-Refer to Figure 13- 2. Suppose this firm initially has the marginal revenue product curve MRP1. One reason that the curve could shift to MRP2 is
A) a decrease in the wage rate. 
B) an increase in the quality of workers employed by the firm. 
C) an increase in the supply of labour. 
D) a decrease in demand for the firm's output, math textbooks. 
E) a decrease in the market price of math textbooks.

Quizplus · Accepted Answer

An increase in the quality of workers employed by the firm would enhance productivity, leading to a higher marginal revenue product, thus shifting the curve from MRP1 to MRP2.

The Diagram Below Shows the MRP Curve for a Firm