What will be an ideal response?
ANSWER:
Agree. For competitive firms, marginal revenue product equals marginal physical product multiplied by product price. For a monopoly, marginal revenue product equals marginal physical product multiplied by marginal revenue. Since marginal revenue falls faster than price, MRP of a monopolist falls faster than the price in a competitive industry. Marginal factor cost is the same for both, so the equilibrium quantity of labor is less for monopoly than for perfect competition.