Assume labor is the only variable input and that an additional input of labor increases total output from 72 to 80 units. If the product sells for $6 per unit in a purely competitive market, the MRP of this additional worker is
A)$6.
B)$8.
C)$48.
D)$80.

Question

Quizplus · Accepted Answer

The Marginal Revenue Product (MRP) is calculated by multiplying the marginal product of labor (the additional output produced by the additional worker, which is 80 - 72 = 8 units) by the price of the product ($6). Therefore, MRP = 8 units * $6/unit = $48.

Assume Labor Is the Only Variable Input and That an Additional