Assume that the product price is $4 per unit and that the hourly wage for workers is $12.Neither price nor wage changes with output.In Table 30.3, the contribution to total revenue of the fourth worker hired is

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Quizplus · Accepted Answer

The fourth worker produces 20 units per hour. At $4 per unit, this is a total revenue contribution of 20 x $4 = $80 per hour. The cost of that worker is $12 per hour, so the net contribution to total revenue is $80 - $12 = $68 per hour. Dividing this number by the number of units produced by the worker (20) gives us the contribution to total revenue per unit, which is $68/20 = $3.4 per unit. Rounding this up to the nearest cent gives us an answer of $3.40 per unit, or $16 per hour. Therefore, the answer is B.

Assume That the Product Price Is $4 Per Unit and That