If the marginal revenue product of the fifth worker hired by a firm is $15 and the price of a unit of output is $5 regardless of how much is sold, then the marginal product of the fifth worker is
A) 15 units of output.
B) 5 units of output.
C) 3 units of output.
D) 45 units of output.
E) 75 units of output.

Question

Quizplus · Accepted Answer

The marginal revenue product (MRP) is calculated as the marginal product (MP) of the worker multiplied by the price of the output. Given MRP = $15 and price = $5, MP = MRP/price = $15/$5 = 3 units of output.

If the Marginal Revenue Product of the Fifth Worker Hired