Economics · Labor Economics
In the competitive labor market framework, at an employment level below equilibrium, an employer has an incentive to hire additional workers because:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Marginal revenue product of labor is zero.
- 2Marginal product of labor is equal to the real wage.
- 3Marginal product of labor is lower than the real wage.
- 4Marginal product of labor exceeds the real wage.✓
Correct answer
Marginal product of labor exceeds the real wage.
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