The marginal revenue product of labor is equal to the product of:
A) the marginal product of labor and the quantity of labor employed.
B) the wage rate and the marginal product of labor.
C) the wage rate and marginal revenue per unit of output
D) marginal product of labor and total revenue of the firm.
E) the marginal revenue per unit of output and the marginal product of labor

Question

Quizplus · Accepted Answer

The marginal revenue product of labor is calculated by multiplying the marginal product of labor (how much extra output is produced by adding one more unit of labor) by the marginal revenue per unit of output (how much extra revenue the firm earns from selling that additional output).

The Marginal Revenue Product of Labor Is Equal to the Product