marginal product of labor

  

Definition

Measure of the physical increase in the output of a firm or economy; it is the output that results from hiring one additional worker, all other factors remaining constant.

Use this term in a sentence

  • You need to make sure that your company can handle a MARGINAL PRODUCT OF LABOR before you decide to expand.

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  • We had our marginal product of labor in place to inform us how we were doing and I was happy with what I saw.

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  • The marginal product of labor derived from hiring 10 more lumberjacks quickly reaches a point of diminishing returns as the trees grow thinner and the women's clothes scarcer.

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