Table 18-4
Consider the following daily production data for Wills Golf Balls.Wills sells golf balls for $2.50 cents each and pays the workers a wage of $325 per day.

-Refer to Table 18-4.What is the value of the marginal product of the fifth worker?

Question

Table 18-4
Consider the following daily production data for Wills Golf Balls.Wills sells golf balls for $2.50 cents each and pays the workers a wage of $325 per day.
 
-Refer to Table 18-4.What is the value of the marginal product of the fifth worker?

Quizplus · Accepted Answer

To calculate the value of the marginal product of the fifth worker, we need to find the difference between the total output of four workers and the total output of five workers, and multiply it by the price of the product.

Total output of four workers = 180
Total output of five workers = 240
Difference in output = 240 - 180 = 60

Value of marginal product of fifth worker = Price x Difference in output
Value of marginal product of fifth worker = $2.50 x 60 = $150

Since the fifth worker is paid a wage of $325 per day, and the value of the marginal product is only $150, it is not profitable to hire the fifth worker. Therefore, the best choice is to not hire the fifth worker.

Table 18-4 Consider the Following Daily Production Data for Wills Golf Balls.Wills