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Chapter 26: Problem 7

The added output for which one additional input of labor is responsible is its (LO3) a) marginal revenue product b) marginal physical product c) average revenue product d) average physical product

Short Answer

Expert verified
The correct answer for the added output for which one additional input of labor is responsible is b) marginal physical product.

Step by step solution

01

Introduction to terms

To solve this problem, it's essential to understand what each of these terms means: a) Marginal Revenue Product (MRP) is the additional revenue generated by employing one more unit of labor holding other factors constant. b) Marginal Physical Product (MPP) is the additional output produced by using one more unit of labor holding other factors constant. c) Average Revenue Product (ARP) is the total revenue generated by a unit of labor divided by the total number of labor units employed. d) Average Physical Product (APP) is the total output produced divided by the total number of labor units employed.
02

Identify the correct term

Since this exercise is focused on finding the added output for which one additional input of labor is responsible, the correct term should be the one that deals with the additional output produced by employing one more unit of labor. Among the given terms, marginal physical product (MPP) fits this description because it refers to the additional output produced by using one more unit of labor holding other factors constant. So, the correct answer is: b) marginal physical product

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Most popular questions from this chapter

Which statement is true? (LO2) a) Productivity is output per unit of input. b) Productivity is input per unit of output. c) Productivity is neither of the above.

The most important influence on a firm's demand for a factor of production is ( LO4) a) the quantities of other resources b) the prices of other resources c) its productivity d) the demand for the final product

Derived demand is the demand for (LO1) a) final goods and services b) resources c) final goods as well as services and resources d) neither final goods and services nor resources

The demand for resources is based on \((\mathrm{LO1}, 2)\) a) only the demand for the final product b) only the productivity of the resource c) both the demand for the final product and the productivity of the resource d) neither the demand for the final product nor the productivity of the resource

If the price that a perfect competitor receives for her final product doubles, the firm's MRP schedule will (LO3) a) rise c) double at each price b) fall d) stay about the same
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