For a competitive, profit-maximizing firm, the labor demand curve is the same as the
A)marginal cost curve.
B)value of marginal product curve.
C)production function.
D)profit function.

Question

Quizplus · Accepted Answer

A competitive, profit-maximizing firm will hire labor until the marginal cost of hiring an additional unit of labor (i.e. the wage rate) equals the value of the marginal product of labor. Therefore, the labor demand curve for such a firm is the same as its value of marginal product curve.

For a Competitive, Profit-Maximizing Firm, the Labor Demand Curve Is