Exhibit 11-1
Use the information in the accompanying chart to answer the following question(s). The firm hires labor competitively and sells its product in a competitive price-taker market. $$\begin{array} { | c | c | c | }
\hline \begin{array} { c }
\text { Units of Labor } \
\text { (per day) }
\end{array} & \begin{array} { c }
\text { T otal Output } \
\text { (dollars) }
\end{array} & \begin{array} { c }
\text { Product } \
\text { Price }
\end{array} \
\hline 1 & 15 & 6 \
2 & 30 & 6 \
3 & 40 & 6 \
4 & 48 & 6 \
5 & 54 & 6 \
6 & 59 & 6 \
7 & 62 & 6 \
\hline
\end{array}$$
-Refer to Exhibit 11-1. What is the marginal revenue product of the fifth unit of labor?

Question

Exhibit 11-1
Use the information in the accompanying chart to answer the following question(s). The firm hires labor competitively and sells its product in a competitive price-taker market. $$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Units of Labor } \
\text { (per day) }
\end{array} & \begin{array} { c } 
\text { T otal Output } \
\text { (dollars) }
\end{array} & \begin{array} { c } 
\text { Product } \
\text { Price }
\end{array} \
\hline 1 & 15 & 6 \
2 & 30 & 6 \
3 & 40 & 6 \
4 & 48 & 6 \
5 & 54 & 6 \
6 & 59 & 6 \
7 & 62 & 6 \
\hline
\end{array}$$
-Refer to Exhibit 11-1. What is the marginal revenue product of the fifth unit of labor?

Quizplus · Accepted Answer

The marginal revenue product (MRP) is calculated by multiplying the marginal product of labor (additional output from one more unit of labor) by the product price. For the fifth unit of labor, the marginal product is 54 - 48 = 6 units. With a product price of $6, the MRP is 6 * 6 = $36.

Exhibit 11-1 Use the Information in the Accompanying Chart to Answer

Exhibit 11-1
Use the Information in the Accompanying Chart to Answer