The labor demand curve of an imperfectly competitive seller is downsloping
A)solely because of diminishing marginal utility.
B)because of both diminishing returns and the necessity to lower price to sell more output.
C)solely because product price must be reduced to sell more output.
D)solely because of diminishing returns.Difficulty: 02 Medium

Question

Quizplus · Accepted Answer

The labor demand curve of an imperfectly competitive seller is downsloping because of both diminishing returns, which reduce the marginal product of labor, and the necessity to lower the product price to sell more output, which reduces the marginal revenue product of labor.

The Labor Demand Curve of an Imperfectly Competitive Seller Is