Question

You have been hired to manage a small manufacturing facility whose cost and production data are given in the table below. ||Workers||Total Labor Cost||Output||Total Revenue |1|250|60|150 |2|500|112|4

Answer 1

No. of workersTotal Labor CostOutputTotal Revenue1 $150 100 $1702 300 108 5503 450 114 11504 600 119 14705 750 123 16006 900 125 17007 1050 126 1750(2 points) What is the marginal product of the second worker?(2 points) What is the marginal revenue product of the fourth worker?(2 points) What is the marginal cost of the fifth worker?(4 points) Based on your knowledge of marginal analysis, how many workers should you hire? Explain you answer.(TCO C) You have been hired to manage a small manufacturing facility which has cost and production data given in the table below.No. of workersTotal Labor CostOutputTotal Revenue1 $150 100 $1702 300 108 5503 450 114 11504 600 119 14705 750 123 16006 900 125 17007 1050 126 1750What is the marginal product of the second worker?The marginal product of the second worker is 8, the amount output increases when employment increases from 1 to 2 workers (108 minus 100).What is the marginal revenue product of the fourth worker? The MRP of the fourth worker is $320,the amount total revenue increases when the fourth worker is hired ($1470 minus $1150).What is the marginal cost of the fifth worker?The MC of the fifth worker is $150, the amount total labor cost increases when the fifth worker is hired ($750 minus $600).Based on your knowledge of marginal analysis, how many workers should you hire? Explain your answer.The firm should hire four workers. Hiring a fifth worker would reduce profit because the MC of the fifth worker ($150) exceeds the MRP of the fifth worker ($130). This is also true for the 6th and 7th workers.