_____ represents a firm's demand curve for labor.

Question

Quizplus · Accepted Answer

The value of marginal product represents the additional revenue generated by each unit of labor hired. As a firm hires more workers, the value of marginal product will decrease (law of diminishing marginal returns), causing the demand curve for labor to slope downward. Therefore, A) is the correct answer. B) represents the relationship between input and output, not the demand for labor. C) is the demand curve for the firm's output, not labor. D) is incorrect as the demand curve for labor is downward sloping, not a horizontal line.

_____ Represents a Firm's Demand Curve for Labor