If a product's price increases, then its:

Question

Quizplus · Accepted Answer

If a product's price increases, its marginal revenue product (MRP) will increase. This is because increasing the price of a good generally leads to a decrease in quantity demanded, which in turn increases the marginal revenue generated from each unit sold. As MRP is the additional revenue generated by each additional unit of labor, an increase in MRP means that the firm will be willing to hire more workers at the higher wage rate.

If a Product's Price Increases, Then Its