Ten cases of spring water are sold for $6 each,and the marginal product of the last unit of labor is 5.If the price of a case increases from $6 to $8,then the marginal revenue product of the last unit of labor would _____
A)decrease by $10.
B)increase by $40.
C)decrease by $30.
D)increase by $10.
E)increase by $20.

Question

Quizplus · Accepted Answer

The marginal revenue product (MRP) is equal to the marginal product (MP) multiplied by the price of the product. In this case, the MRP of the last unit of labor is 5 x $6 = $30. 
If the price of a case increases to $8, then the MRP of the last unit of labor would be 5 x $8 = $40. Therefore, the MRP would increase by $10. 
Option D is the correct answer.

Ten Cases of Spring Water Are Sold for $6 Each,and