Table 12.3,which is data for the firm Skipper the Shoe Maker.
Table 12.3

-Use Table 12.3 to answer this question.What is the marginal revenue product of the 4^th hour of labour?

Question

Table 12.3,which is data for the firm Skipper the Shoe Maker. Table 12.3 -Use Table 12.3 to answer this question.What is the marginal revenue product of the 4^th hour of labour?

Quizplus · Accepted Answer

The marginal revenue product of the 4^th hour of labour can be calculated by multiplying the marginal product of labor (6 units of output) by the marginal revenue (price) per unit of output ($6 per unit). Therefore, the marginal revenue product is 6 x $6 = $36. The best choice would be to hire this additional hour of labor as it adds more revenue than cost (which is given as $30 for each hour of labor).

Table 123,which Is Data for the Firm Skipper the Shoe Maker