How the Competitive Firm Decides How Much labor to hire Marginal Product value of the of Labor Marginal Product Marginal Profit L abor Output MPL of Labor Wage [A Profit= VMPL-w L Q MPL=△Q/△ ⅤMPL= PXMPL 01 0 1001005100 500 $500 180 80 800 $500 300 2345 240 60 $600 $500 $100 280 40 $400 $500 $100 30020 $ 200 $500 3Labor L Output Q Marginal Product of Labor MPL Value of the Marginal Product of Labor VMPL=PxMPL Wage W Marginal Profit 0 0 1 100 100 $1,000 $500 $500 2 180 8 0 $800 $500 $300 3 240 6 0 $600 $500 $100 4 280 4 0 $400 $500 -$100 5 300 2 0 $200 $500 -$300 D Pr ofit = VMPL- W MPL = D Q/ D L How the Competitive Firm Decides How Much Labor to Hire