Asked by Samantha Hicks on Jun 09, 2024
Verified
The MRP curve for labor
A) intersects the firm's labor demand curve from above.
B) is the firm's labor demand curve.
C) lies below the firm's labor demand curve.
D) lies above the firm's labor demand curve.
MRP Curve
The Marginal Revenue Product curve, representing the additional revenue generated by employing one more unit of a resource or factor of production.
Labor Demand
The complete number of employees that employers are prepared and capable of hiring at a certain salary level during a specific timeframe.
- Understand the relationship between the MRP curve and the firm's labor demand curve.
Verified Answer
LP
Leywes PierreJun 14, 2024
Final Answer :
B
Explanation :
The MRP (Marginal Revenue Product) curve for labor represents the additional revenue a firm earns from hiring one more unit of labor, and it is equivalent to the firm's demand curve for labor. This is because firms decide on the quantity of labor to hire based on the additional revenue generated by that labor.
Learning Objectives
- Understand the relationship between the MRP curve and the firm's labor demand curve.