Question

Suppose a certain firm is able to produce 165 units of output per day when 15 workers are hired. The firm is able to produce 181 units of output per day when 16 workers are hired, holding other inputs fixed. The marginal product of the 16th worker is:_______.

a. 10 units of output.
b. 181 units of output.
c. 11 units of output.
d. 16 units of output.

Answer 1

D. 16 units of output

Step-by-step explanation:

Marginal product refers to the increase in total production as a result of a unit increase in factor input.

Marginal product= Change in total units produced/change in variable inputs

Change in total units produced=

New units - previous units

Previous units=165 units

New units= 181 units

Change in total units= 181-165

=16

Change in variable inputs= New inputs - previous inputs

New inputs=16 workers

Previous inputs=15 workers

Change in variable inputs=16-15

=1 worker

Therefore,

Marginal product= Change in cost/change in output

Marginal product= 16 units/1 worker

=16 units of output

Answer 2

D

Step-by-step explanation:

Marginal output of a production is defined as the cchange in the unit produced as a result of employing one more unit of a particular factor of production.

As other inputs are fixed , the calculation is as below

Workings

marginal Output of 16th Worker = 181-165

=16 Units of output