Answer the Question on the Basis of the Following Information

question 12

Multiple Choice

Answer the question on the basis of the following information.A farmer who has fixed amounts of land and capital finds that total product is 24 for the first worker hired;32 when two workers are hired;37 when three are hired;and 40 when four are hired.The farmer's product sells for $3 per unit and the wage rate is $13 per worker. Refer to the given information.The marginal revenue product of the second worker is:

• A) $24.
• B) $8.
• C) $15.
• D) $9.

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Definitions:

Operating Income

Earnings before interest and taxes (EBIT), representing a company’s profit from its core business operations.

Variable Costs

Costs that vary directly with the level of production or sales volume, such as raw materials and direct labor costs.

Fixed Costs

Costs that do not vary with the volume of output produced, such as rent, salaries, and insurance premiums.

High-low Method

A technique in cost accounting used to estimate fixed and variable costs given the highest and lowest levels of activity.