Describe how the addition of pounds of rubber will affect

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Reference no: EM1351977

Marginal revenue product is defined as the change in total revenue that results from the employment of an additional unit of a resource. a widget producer wishes to determine how the addition of pounds of rubber will affect its MRP and profits.

Pounds of rubber number of widges price
(quanity resource) (total product) of widgets ($)
0 0 -
1 20 12
2 35 10
3 45 8
4 50 6
5 53 4

a. the marginal product of the 3rd pound of rubber is ?

b. the marginal revenue product of the 3rd pound of rubber is?

c. the price of rubber is $100 per pound. to maximize profit, the widget producer should produce?

d. the price of rubber is $110 per pound. to maximize profit the widget producer should buy and use?

Reference no: EM1351977

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