{"id":22623,"date":"2025-06-16T20:29:33","date_gmt":"2025-06-16T20:29:33","guid":{"rendered":"https:\/\/gaviki.com\/blog\/?p=22623"},"modified":"2025-06-16T20:29:35","modified_gmt":"2025-06-16T20:29:35","slug":"in-the-short-run-the-marginal-product-of-labor-is-inversely-related-to","status":"publish","type":"post","link":"https:\/\/gaviki.com\/blog\/in-the-short-run-the-marginal-product-of-labor-is-inversely-related-to\/","title":{"rendered":"In the short run, the marginal product of labor is inversely related to"},"content":{"rendered":"\n<p>In the short run, the marginal product of labor is inversely related to <\/p>\n\n\n\n<p>(A) economic profit <\/p>\n\n\n\n<p>(B) marginal utility <\/p>\n\n\n\n<p>(C) average fixed cost <\/p>\n\n\n\n<p>(D)average product of labor <\/p>\n\n\n\n<p>(E) marginal cost<\/p>\n\n\n\n<p><mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-vivid-cyan-blue-color\"><strong>The correct answer and explanation is:<\/strong><\/mark><\/p>\n\n\n\n<p><strong>Correct Answer: (E) Marginal Cost<\/strong><\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Explanation:<\/strong><\/h3>\n\n\n\n<p>In the <strong>short run<\/strong>, the <strong>marginal product of labor (MPL)<\/strong> refers to the <strong>additional output<\/strong> produced by employing one more unit of labor, keeping other inputs (like capital) constant. The <strong>marginal cost (MC)<\/strong> is the <strong>additional cost<\/strong> of producing one more unit of output.<\/p>\n\n\n\n<p>There is an <strong>inverse relationship<\/strong> between the <strong>marginal product of labor (MPL)<\/strong> and the <strong>marginal cost (MC)<\/strong> because: Marginal&nbsp;Cost&nbsp;(MC)=Wage&nbsp;Rate&nbsp;(w)Marginal&nbsp;Product&nbsp;of&nbsp;Labor&nbsp;(MPL)\\text{Marginal Cost (MC)} = \\frac{\\text{Wage Rate (w)}}{\\text{Marginal Product of Labor (MPL)}}<\/p>\n\n\n\n<p>This formula shows that as the <strong>marginal product of labor increases<\/strong>, the <strong>marginal cost of production decreases<\/strong>, and vice versa.<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Why the Relationship is Inverse:<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>When workers become <strong>more productive<\/strong>, each additional unit of output requires <strong>less labor<\/strong> and therefore costs <strong>less<\/strong> to produce.<\/li>\n\n\n\n<li>Conversely, if the marginal product of labor <strong>declines<\/strong> (due to the law of diminishing returns), then <strong>more labor<\/strong> is needed for each additional unit of output, increasing the <strong>marginal cost<\/strong>.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Incorrect Answer Explanations:<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>(A) Economic profit:<\/strong> Not directly tied to MPL. It\u2019s the difference between total revenue and total cost.<\/li>\n\n\n\n<li><strong>(B) Marginal utility:<\/strong> Relates to consumer satisfaction, not production input\/output.<\/li>\n\n\n\n<li><strong>(C) Average fixed cost:<\/strong> Fixed costs don&#8217;t change with labor or output; they\u2019re spread over more units.<\/li>\n\n\n\n<li><strong>(D) Average product of labor:<\/strong> While related to MPL, they are not inversely tied. Both can increase or decrease together depending on the stage of production.<\/li>\n<\/ul>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Conclusion:<\/strong><\/h3>\n\n\n\n<p>In the short run, as firms add more labor to fixed capital, they eventually experience <strong>diminishing marginal returns<\/strong>, which lowers the <strong>marginal product of labor<\/strong> and raises the <strong>marginal cost<\/strong>. Hence, <strong>(E) marginal cost<\/strong> is the correct answer due to this <strong>inverse relationship<\/strong>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In the short run, the marginal product of labor is inversely related to (A) economic profit (B) marginal utility (C) average fixed cost (D)average product of labor (E) marginal cost The correct answer and explanation is: Correct Answer: (E) Marginal Cost Explanation: In the short run, the marginal product of labor (MPL) refers to the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-22623","post","type-post","status-publish","format-standard","hentry","category-quiz-questions"],"_links":{"self":[{"href":"https:\/\/gaviki.com\/blog\/wp-json\/wp\/v2\/posts\/22623","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/gaviki.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/gaviki.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/gaviki.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/gaviki.com\/blog\/wp-json\/wp\/v2\/comments?post=22623"}],"version-history":[{"count":1,"href":"https:\/\/gaviki.com\/blog\/wp-json\/wp\/v2\/posts\/22623\/revisions"}],"predecessor-version":[{"id":22624,"href":"https:\/\/gaviki.com\/blog\/wp-json\/wp\/v2\/posts\/22623\/revisions\/22624"}],"wp:attachment":[{"href":"https:\/\/gaviki.com\/blog\/wp-json\/wp\/v2\/media?parent=22623"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/gaviki.com\/blog\/wp-json\/wp\/v2\/categories?post=22623"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/gaviki.com\/blog\/wp-json\/wp\/v2\/tags?post=22623"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}