Jim Smith Runs a Company That Sells Encyclopedia Sets for $200

question 137

Multiple Choice

Jim Smith runs a company that sells encyclopedia sets for $200 each. When he employs 5 workers, they can sell 20 sets per week, whereas only 17 sets are sold when 4 workers are employed. What is the weekly marginal revenue product of the fifth worker?

• A) $3
• B) $200
• C) $600
• D) $4,000

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Definitions:

Allowance Factor

A factor used to calculate the amount of material needed considering waste or inefficiency, often in manufacturing or budgeting.

Standard Time

The established amount of time required to perform a specific task under normal conditions with average effort.

Performance Rating

An assessment of an individual's or machine's productivity level, often compared against a standard to gauge efficiency.

Observed Time

The actual amount of time measured for a task or process to be completed, as opposed to estimated or standard time.