If a firm experiences a decrease in the price of its product while keeping the wage constant, the Marginal Revenue Product of Labor will also decrease, leading the firm to potentially hire more workers to maintain output levels.

When a firm lowers the price of its product but keeps wages the same, it affects how much money the firm makes from selling each additional unit of that product. This is called the Marginal Revenue Product of Labor (MRP), which measures the additional revenue generated by hiring one more worker. If the price drops, the revenue from selling each unit goes down, so the MRP also decreases. To keep producing the same amount of goods, the firm may decide to hire more workers because each worker can still contribute to overall production despite the lower price. For example, if a bakery sells cupcakes for $2 instead of $3, the revenue from each cupcake goes down, but if they want to keep making the same number of cupcakes, they might hire more bakers to help produce them efficiently.