Question

Ralph owns a small pizza restaurant. He currently has 5 employees; with 5 employees, his restaurant

can produce 50 pizzas per day. If he hired a 6th employee, he'd be able to produce 52 pizzas per day.
Therefore, the marginal product of the 6th employee is ?

Answer 1

The marginal product of the 6th employee at Ralph's pizza restaurant is 2 pizzas per day, calculated based on the increase in total pizzas produced when this employee is added to the workforce.

Step-by-step explanation:

The marginal product of labor is a key concept in economics and refers to the additional output that results from hiring one more worker.

To calculate the marginal product of the 6th employee in Ralph's pizza restaurant, we look at the increase in the number of pizzas produced when the 6th employee is hired. With 5 employees, the restaurant produces 50 pizzas per day, and with 6 employees, it produces 52 pizzas per day. Therefore, the marginal product of the 6th employee is the difference in production, which can be calculated as:

MP = Change in Total Product (ATP) / Change in Labor (AL)

MP = (52 pizzas - 50 pizzas) / (6 employees - 5 employees)

MP = 2 pizzas per day

Thus, the marginal product of the 6th employee is 2 pizzas per day. This reflects the extra contribution to pizza production that the 6th employee brings to the restaurant.