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Basic Question 26 of 29
The change in total revenue that results from employing one more unit of labor is called the ______.
B. marginal revenue product
C. marginal product
A. marginal revenue
B. marginal revenue product
C. marginal product
User Contributed Comments 5
| User | Comment |
|---|---|
| Khadria | MRP = MR * MP where MR is the change in revenue for one additional unit produced. |
| boddunah | MR is the change in TR for one additional unit sold. 1 unit sold for $10 = $10(TR) 2 units sold for $18 = $18(TR) MR = 18-10/1 = 8. MP is the change in TP for one additional unit labor employed. 1 unit of labor produces 4 goods(TP) 2 units of labor produce 7 goods(TP) MP = change in TP/change in labor. MP = 7-4/1 = 3 MRP = MR*MP MRP = 8*3 --> 24 |
| boddunah | perfect competitive market MR = P . MRP = MR*MP MRP = P*MP----. price* marginal product of labor. |
| PJMOHAN | I found the post by boddunah more informative and concept clearing than the entire write up!! Thanks a lot!!!! |
| fangluez | Definition: MR = Change of total revenue from additional unit of production and sale of additional output. MP = Change of total production from hiring additional labor. |
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Learning Outcome Statements
determine and interpret break even and shutdown points of production, as well as how economies and diseconomies of scale affect costs under perfect and imperfect competition
CFA® 2024 Level I Curriculum, Volume 1, Module 1.