Table 17-2 For the Production Data Represented in This Table, Assume That

question 56

Multiple Choice

Table 17-2

For the production data represented in this table, assume that labor is the only variable input.
-Refer to Table 17-2.The marginal revenue product of labor from the third unit of labor is

• A)$5,460.
• B)$1,560.
• C)$1,260.
• D)$780.

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Definitions:

Third-Degree Price Discrimination

A pricing strategy where a seller charges different prices to different consumer groups for the same product, based on their willingness to pay.

Marginal Cost Function

A mathematical expression that describes how the cost of producing one additional unit of a good or service varies with the quantity produced.

Reservation Price

The maximum amount a consumer is willing to pay for a good or service.

Elasticity of Demand

An index that determines the sensitivity of consumer demand for a product to its price change, by comparing the percent change in the amount of the good demanded with the percent change in its price.