Asked by Jocelyn Espericueta on Jul 18, 2024
Verified
If MRP of labor < wage rate, a firm should hire more workers.
MRP
The marginal revenue product, which is the additional revenue generated from using one more unit of a factor of production.
Wage Rate
The amount of money paid to an employee per unit of time or for each unit of output produced.
- Fathom the relationship among marginal revenue product (MRP), salaries, and the decision-making process for employing personnel.
Verified Answer
MS
Makayla SwinfordJul 19, 2024
Final Answer :
False
Explanation :
If the Marginal Revenue Product (MRP) of labor is less than the wage rate, it means that each additional worker hired is generating less revenue than it costs to hire them, so a firm should not hire more workers under these conditions.
Learning Objectives
- Fathom the relationship among marginal revenue product (MRP), salaries, and the decision-making process for employing personnel.
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