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Marginal Revenue Product of Labour - Explained (Labour Markets)
- Level:
- A-Level, IB
- Board:
- AQA, Edexcel, OCR, IB, Eduqas, WJEC
Last updated 21 Mar 2021
Marginal revenue product of labour (MRPL) is the extra revenue generated when an additional worker is employed.
The formula for MRPL = marginal product of labour x marginal revenue.
The demand curve for labour tells us how many workers a business will employ at a given wage rate in a given time period
In the theory of competitive labour markets, the demand curve for labour comes from the estimated marginal revenue product of labour (MRPL)
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