Every time a firm hires more labor, they get more output which means more revenue. In this video,m we begin thinking about how much incremental benefit a firm gets from hiring one more person. [13:03]

Learn about how firms determine the optimal combination of capital and labor in this video. [10:29]

When there is a single buyer of labor this type of market is called a monopsonistic labor market. Learn how this changes the analysis of labor markets and why marginal factor cost is higher than the supply of labor in such markets. [9:23]