The marginal revenue product of labor at the local sawmill is MRPL = 20 - 0.5L, where L = the number of workers. If the wage of sawmill workers is $10 per hour, then how many workers will the mill hire?

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A firm can attain the point of profit-maximization through choosing the optimal level of employment of its inputs. In other words, a firm can maximize profits by choosing the optimal value for either output or input usage. It happens when marginal contribution of the input to revenue is the same as marginal cost of hiring such input.

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Labor Market: Definition & Theory

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Learn the labor market definition and what happens in the labor market. See what the split labor market theory is and learn the different types of labor market.

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The marginal revenue product of labor at the local sawmill is MRPL = 20 - 0.5L, where L = the...

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