Scenario: Consider a Firm That Produces and Sells a Good

Multiple Choice

Scenario: Consider a firm that produces and sells a good for the price of $2 in a perfectly competitive market. The following table shows the relationship between the number of workers and the output of this firm. Suppose the labor market from which this firm hires its employees is competitive.

-Refer to the scenario above.The marginal product of labor for this firm is ________.

A) increasing
B) decreasing
C) constant
D) at first increasing and then constant