The marginal product of labor curve represents:
A)the demand for wages.
B)the supply of labor.
C)the demand for labor.
D)the demand for capital.
E)the supply of wages.

Question

Quizplus · Accepted Answer

The marginal product of labor curve represents the additional output that is produced by hiring one more unit of labor, while keeping all other inputs constant. The value of this additional output is equated with the marginal revenue product of labor, which is the additional revenue generated by hiring one more unit of labor. Firms will hire labor up to the point where the marginal revenue product of labor equals the wage rate, which is the demand for labor. Therefore, the marginal product of labor curve represents the demand for labor.

The Marginal Product of Labor Curve Represents