Figure 18-2

-Refer to Figure 18-2.If the marginal product of labor falls and the price of apples remains unchanged, (i) the value of the marginal product of labor will fall.
(ii) the quantity of labor demanded will increase above L₁.
(iii) the labor supply curve will remain unchanged.

Question

Figure 18-2
 
-Refer to Figure 18-2.If the marginal product of labor falls and the price of apples remains unchanged, (i)	the value of the marginal product of labor will fall.
(ii)	the quantity of labor demanded will increase above L₁.
(iii)	the labor supply curve will remain unchanged.

Quizplus · Accepted Answer

If the marginal product of labor falls, it means that each additional unit of labor is adding less to the total revenue or output. Therefore, the value of the marginal product of labor will fall. However, since the price of apples remains unchanged, it will not affect the quantity of labor demanded, which will remain at L₁. Additionally, the labor supply curve will remain unchanged because this change only affects the productivity of labor, not the willingness of workers to supply their labor. Hence, choice (i) and (iii) are correct while (ii) is incorrect.

Figure 18-2 -Refer to Figure 18-2.If the Marginal Product of Labor Falls