Marginal revenue product, Marginal revenue product is

Marginal revenue product

Assignment Help Microeconomics

Reference no: EM13909328

Marginal Revenue Product

Marginal revenue product is defined as the change in total revenue that results from the employment of an additional unit of a resource. A producer wishes to determine how the addition of pounds of plastic will affect its MRP and profits. See the table below, and answer each of the questions.

Pounds of plastic (quantity of resource)	Number of assemblies (total product)	Price of assemblies ($)
0	0	-
1	15	13
2	30	11
3	40	9
4	55	7
5	58	5

a. The marginal product of the 3rd pound of plastic is ________.

b. The marginal revenue product of the 3rd pound of plastic is ______.

c. The price of plastic is $135 per pound. To maximize profit, the producer should produce

__________________.

d. The price of plastic is $135 per pound. To maximize profit, the producer should buy and use:

Reference no: EM13909328

Questions Cloud

Explain main arguments in favor of economic stabilization : Explain the main arguments in favor of economic stabilization during recessions. Explain why policy lags could make stabilization policies counterproductive.

Efficient market hypothesis-is the stock market efficient : The finance industry is in the midst of a transformative period of evolution, and financial economists have a huge agenda to tackle. Capital Marketing Theory and the Efficient Market Hypothesis are two common concepts used to describe the relationshi..

Pricniples of macroeconomicsn : Here's a quote from Fed head Janet Yellen on at a meeting in Cleveland on July10 this year. (see www.federalreserve.gov then click news and events...Regarding inflation, as I mentioned earlier, the recent effects of lower prices for crude oil andfor ..

Variable costs per composite unit : Handy Home sells windows and doors in the ratio of 8:2 (windows: doors).

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

Calculate the new bond price : Consider a 5.8 percent coupon bond with eleven years to maturity and a current price of $1,060.10. Suppose the yield on the bond suddenly increases by 2 percent. a. Use duration to estimate the new price of the bond. Calculate the new bond price

Discuss the runway excursion : There are five imaginary surfaces that make up an airport's navigable airspace. Most aviation accidents happen in the primary surface, and they are usually the flavor of runway incursions. Do some research and tell the class why you think these run..

Taxation options on selling the stocks : George has asked you for advice. He has a stock portfolio worth about $700,000 with a cost basis of $400,000. He would like to retire and have a steady stream of income from this asset. He has no immediate family. You may make some assumptions, such ..

What is this firms common stock worth : A firm is anticipated to produce a $10,000 cash flow in year 1, $2,500 cash flows in years 2 through 4, and then will pay a steady stream of $1,250 cash flows into the foreseeable future (i.e. forever). Also, the firm has a weighted average cost of c..

User Account

All Pages