The Following Table Shows the Marginal Revenue of a Firm

question 89

Multiple Choice

The following table shows the marginal revenue of a firm and the marginal physical product of different units of labor in a perfectly competitive labor market. Table 14.5
Note: Marginal revenue product of a resource is the product of MPP and MR.
In Table 14.5, if the wage rate is $10, how many workers will be employed by a profit-maximizing firm ?

• A)1
• B)2
• C)3
• D)4

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Definitions:

Direct Labor Cost

The total cost of workforce directly involved in the production of goods or services, excluding indirect labor.