What Is the Difference Between Labor's Marginal Product and Marginal

question 271

Multiple Choice

What is the difference between labor's marginal product and marginal revenue product?

• A)The marginal product of labor is the increase in output as a result of hiring an additional worker while the marginal revenue product of labor is the increase in profit as a result of hiring an additional worker.
• B)The marginal revenue product of labor is the dollar value of hiring an additional worker while the marginal product of labor is the increase in the firm's physical output as a result of hiring an additional worker.
• C)The marginal product of labor is the additional labor's contribution to the firm's total output while the marginal revenue product is the additional labor's contribution to the firm's total sales revenue.
• D)Labor's marginal product is a measure of labor's productivity while labor's marginal revenue product is a measure of labor's ability to sell the firm's products.

---

Definitions:

Unit Sold

The total number of individual items or products that have been sold by a business during a given period.

Variable Cost

Costs that change in direct proportion to changes in the levels of production or sales activities, such as materials and labor costs.

Relevant Range

The range of activity or volume over which the assumed cost behavior is valid, beyond which cost patterns and relationships may change.

Average Costs

The total costs divided by the number of units produced, giving a per unit cost average.