The change in total revenue associated with one additional unit of input measures
A) Elasticity of labor supply.
B) Cost efficiency.
C) MPP.
D) MRP.

Question

Quizplus · Accepted Answer

The change in total revenue associated with one additional unit of input measures is known as Marginal Revenue Product (MRP). MRP is the additional revenue generated by employing one more unit of factor input (e.g. labor) while holding all other inputs constant. It is calculated as the product of marginal product of labor (MPL) and marginal revenue (MR). Thus, option D is the correct answer.

The Change in Total Revenue Associated with One Additional Unit