Asked by Anselin Aryee on May 03, 2024

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If one worker can pick $30 worth of grapes and two workers together can pick $50 worth of grapes,the:

A) marginal revenue product of each worker is $25.
B) marginal revenue product of the first worker is $20.
C) marginal revenue product of the second worker is $20.
D) data given do not permit the determination of the marginal revenue product of either worker.

Marginal Revenue Product

The extra income that comes from using an additional unit of a resource, like workers or money.

  • Become familiar with the principle of Marginal Revenue Product (MRP) and the steps for determining its value.
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LN
Leslie NungarayMay 06, 2024
Final Answer :
C
Explanation :
Let the marginal revenue product of the first worker be MRP1 and that of the second worker be MRP2. We know that:
MRP1 = contribution of the first worker to the total output * marginal revenue
and
MRP2 = contribution of the second worker to the total output * marginal revenue
From the given information, we can write:
Contribution of the first worker to the total output = $30
Contribution of the second worker to the total output = $50 - $30 = $20
Since we do not have information on the marginal revenue, we cannot calculate the exact values of MRP1 and MRP2, but we can say that they are different because the two workers have different contributions to the total output. Therefore, the best choice is C.