The downward sloping marginal physical product of labor is the firm's ?
Correct answer: B. Short-run demand curve for labor
- A. Supply of labor
- B. Short-run demand curve for labor
- C. marginal cost of labour
- D. marginal revenue product of labor
Explanation
With the product price held constant, a firm's marginal revenue product of labour is proportional to the marginal physical product and slopes downward. It therefore represents the firm's short-run demand curve for labour.
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