3 concepts
Marginal Product of Labor (Physical)
The marginal product of labor is the change in output that results from employing an added unit of labor.
Marginal Product of Labor (Revenue)
The marginal revenue product of labor is the change in revenue that results from employing an additional unit of labor.
Deriving the Labor Demand Curve
Firms will demand labor until the marginal revenue product of labor is equal to the wage rate.