Scenario: Mark grows herbs in his backyard. The following table shows his output as a function of the square feet of land used.

-Refer to the scenario above.If Mark can sell his herbs at the price of $2.50 per pound,what is the value marginal product of land when the second square foot of land is used?

Question

Scenario: Mark grows herbs in his backyard. The following table shows his output as a function of the square feet of land used.
 
-Refer to the scenario above.If Mark can sell his herbs at the price of $2.50 per pound,what is the value marginal product of land when the second square foot of land is used?

Quizplus · Accepted Answer

To find the value marginal product of land, we need to calculate the change in total product resulting from using an additional unit of land, multiplied by the market price of the output.

The table shows that when Mark uses the first square foot of land, the total output is 5 pounds of herbs. When he uses the second square foot of land, the total output is 9 pounds. Therefore, the change in total product is 4 pounds of herbs (9 - 5).

The market price of the output is $2.50 per pound. So, the value marginal product of land when the second square foot of land is used can be calculated as:
Value Marginal Product of Land = Change in Total Product x Price of Output
Value Marginal Product of Land = 4 x $2.50 = $10

Therefore, the answer is D.

Scenario: Mark Grows Herbs in His Backyard