Exhibit 13-1
-Refer to Exhibit 13-1. If output price is $12 and the weekly wage is $300, the marginal revenue product of the fourth worker is

Question

Exhibit 13-1 
-Refer to Exhibit 13-1. If output price is $12 and the weekly wage is $300, the marginal revenue product of the fourth worker is

Quizplus · Accepted Answer

The marginal revenue product (MRP) of labor equals the additional revenue generated by hiring an additional worker. To calculate MRP, we take the marginal product of labor (MPL) and multiply it by the output price (P). In this case, as shown in the table, the MPL of the fourth worker is 16 units, so the MRP of the fourth worker is 16 x $12 = $192. Therefore, hiring the fourth worker would generate an additional revenue of $192, which is greater than the cost of hiring the worker ($300), so it would be the best choice.

Exhibit 13-1 -Refer to Exhibit 13-1. If Output Price Is $12 and Is