Understanding Marginal Product and Revenue

What is the marginal product of the third worker?

• 2

• 10

• 15

• 5

Why would a firm not hire a fifth worker?

• The fifth worker adds a marginal product of 10.

• The fifth worker adds zero marginal product.

• The fifth worker adds a negative marginal product.

• The fifth worker adds a positive marginal product.

How is the marginal revenue product (MRP) calculated?

• By multiplying the marginal product by the price of the product.

• By adding the marginal product to the total revenue.

• By multiplying the marginal product by the wage rate.

• By subtracting the wage rate from the marginal product.

If the wage is $5, which worker would not be hired based on their MRP?

• First worker

• Fourth worker

• Second worker

• Third worker

What is the total profit when hiring three workers, given a fixed cost of $50 and a total revenue of $60?

• $5 loss

• $10 profit

• $10 loss

• $5 profit