Suppose that eight workers can manufacture 63 radios per day and that nine workers can manufacture 85 radios per day. If radios can be sold for $18 each, the value of marginal product of the ninth worker is

Question

Quizplus · Accepted Answer

The value of the marginal product of the ninth worker is calculated by first finding the marginal product, which is the additional output produced by the ninth worker, and then multiplying it by the price per unit. The marginal product is 85 radios (with nine workers) minus 63 radios (with eight workers) = 22 radios. Multiplying the marginal product (22 radios) by the price per radio ($18) gives $396.

Suppose That Eight Workers Can Manufacture 63 Radios Per Day