The Marginal Product of Labour Is the Increase in Output

question 96

True/False

The marginal product of labour is the increase in output as a result of hiring an additional worker while the marginal revenue product of labour is the increase in profit as a result of hiring an additional worker.

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Definitions:

Trade-Off

The concept of giving up one benefit or advantage in order to gain another regarded as more favorable.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision, reflecting the potential benefits one misses out on when choosing one option over another.

Bowed Outward

Describes a curve on a graph, typically a production possibility frontier, indicating increasing opportunity costs when shifting resources between two goods.

Opportunity Cost

The cost of choosing one option over another, typically the best alternative forgone as a result of making a decision.