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If the marginal product of a worker changes based upon the aggregate output of all the workers employed, and if we assume a perfectly competitive
If the marginal product of a worker changes based upon the aggregate output of all the workers employed, and if we assume a perfectly competitive market, then the value of each worker's output will be the market price of the product. The formula for this is: Demand for Labor (DL) = MPL x P = Value of the Marginal Product of Labor (VMPL) In the table below, you can see this set out for different levels of employment: # of Workers (L) 1 2 3 4 MPL 4 3 2 1 Price of Output (P) $ 4 $ 4 $ 4 $ 4
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