Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Marginal Revenue Product
B
Total Revenue Product
C
Average Product of Labor
D
Labor Demand Curve
Understanding the Answer
Let's break down why this is correct
Answer
The Marginal Revenue Product of Labor (MRPL) is an important concept that helps businesses understand how much extra money they can make by hiring one more employee. It looks at the additional revenue that a new worker can bring to the company. For example, if a bakery hires an extra baker and that person helps create enough pastries to earn an extra $200 a day, the MRPL for that baker is $200. By knowing this number, businesses can decide whether hiring more workers will make them more money or if it might be better to keep their current staff. This way, firms can manage their labor costs effectively and boost overall productivity.
Detailed Explanation
This term means the extra money a company makes when they hire one more worker. Other options are incorrect because This term refers to all the money a company makes from all workers, not just one; This measures the average output per worker, not the extra money from hiring one more.
Key Concepts
Marginal Revenue Product of Labor
Labor Costs
Productivity Optimization
Topic
Labor Productivity and Decision-Making
Difficulty
easy level question
Cognitive Level
understand
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