Although they are distinctly different, the marginal product of labor, MPL, and labor productivity are closely related and should behave similarly. Go to the St. Louis Federal Reserve FRED database, and find data on output per hour (OPHNFB) and real compensation per hour (COMPRNFB) in the nonfarm business sector. Plot both data series on the same graph by using the Add Data Series function.

a) Generally, how does the labor productivity measure (OPHNFB) behave during recessions and during expansions? Generally, how does the real compensation measure (COMPRNFB) behave during recessions and during expansions?

b) Assuming output per worker is a good proxy for the marginal product of labor, is your answer to part

(a) consistent with how you would expect the labor market to behave? Briefly explain.