Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Calculate Marginal Revenue → Determine Marginal Product of Labor → Multiply them to find MRPL
B
Determine Marginal Product of Labor → Calculate Total Revenue → Subtract Costs
C
Calculate Total Product → Determine Wage Rate → Assess Market Demand
D
Evaluate Labor Costs → Estimate Output → Add Fixed Costs
Understanding the Answer
Let's break down why this is correct
Answer
To determine the Marginal Revenue Product of Labor (MRPL), you first need to understand what MRPL represents. It measures the additional revenue generated by adding one more worker. To calculate MRPL, you start by finding the additional output produced by hiring that extra worker, which is known as the marginal product of labor (MPL). Then, you multiply the MPL by the price at which the output is sold to find the MRPL. For example, if hiring one more worker increases production by 10 units and each unit sells for $5, the MRPL would be 10 times 5, resulting in $50 of additional revenue from that worker.
Detailed Explanation
First, you calculate the extra money made from selling one more product. Other options are incorrect because This option mixes up the steps; This choice focuses on total product and costs, which isn't the right approach for MRPL.
Key Concepts
Marginal Revenue Product of Labor
Marginal Revenue
Marginal Product of Labor
Topic
Calculating Marginal Revenue Product
Difficulty
easy level question
Cognitive Level
understand
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