In marginal analysis for hiring, firms evaluate the additional output produced by hiring one more worker, referred to as the __________. This helps in determining the optimal number of employees based on productivity and revenue generation.

In marginal analysis for hiring, firms look at the additional output produced by hiring one more worker, which is called the marginal product of labor. This concept helps businesses understand how much extra work a new employee can do and how that affects overall production. For example, if a company hires one more worker and they can produce 10 more units of a product, the firm considers if the extra revenue from those units is worth the cost of hiring that worker. By comparing the marginal product to the wage paid, firms can decide if they should hire more workers or maintain their current staff. This analysis ensures that companies operate efficiently and maximize their profits.