The marginal product of labour is defined as
A) the additional sales revenue that results when one more worker is hired.
B) the additional output that results when one more worker is hired, holding all other resources constant.
C) the additional number of workers required to produce one more unit of output.
D) the cost of hiring one more worker.

Question

Quizplus · Accepted Answer

The marginal product of labour (MPL) is the additional output that results from hiring one more unit of labour while holding all other factors of production constant. MPL is a measure of the productivity of labour input, and it helps firms to make decisions about hiring or downsizing. A and D are incorrect because they do not reflect the actual definition of MPL. C is incorrect because it implies that the MPL is fixed, which is not the case.

The Marginal Product of Labour Is Defined as