Table 18-7
The table displays data for a small, competitive, profit-maximizing firm that produces and sells envelopes. Assume that labor is the only input that varies for the firm.

$$\begin{array} { | c | c | c | }
\hline \begin{array} { c }
\text { Labor } \
\text { (Number of workers) }
\end{array} & \begin{array} { c }
\text { Marginal Product of Labor } \
\text { (Boxes of envelopes per week) }
\end{array} & \begin{array} { c }
\text { Wage } \
\text { (Dollars per } \
\text { worker per week) }
\end{array} \
\hline 0 & & \
\hline 1 & 133 & 393 \
\hline 2 & 111 & 393 \
\hline 3 & 93 & 393 \
\hline 4 & 83 & 393 \
\hline 5 & 75 & 393 \
\hline
\end{array}$$
-Refer to Table 18-7. Suppose the firm sells each box of envelopes that it produces for $5. What is the marginal profit of the fourth worker?
A)$18
B)$22
C)-$18
D)$415

Question

Table 18-7
The table displays data for a small, competitive, profit-maximizing firm that produces and sells envelopes. Assume that labor is the only input that varies for the firm.
​
​
 $$\begin{array} { | c | c | c | } 
\hline \begin{array} { c } 
\text { Labor } \
\text { (Number of workers) }
\end{array} & \begin{array} { c } 
\text { Marginal Product of Labor } \
\text { (Boxes of envelopes per week) }
\end{array} & \begin{array} { c } 
\text { Wage } \
\text { (Dollars per } \
\text { worker per week) }
\end{array} \
\hline 0 & & \
\hline 1 & 133 & 393 \
\hline 2 & 111 & 393 \
\hline 3 & 93 & 393 \
\hline 4 & 83 & 393 \
\hline 5 & 75 & 393 \
\hline
\end{array}$$ ​
-Refer to Table 18-7. Suppose the firm sells each box of envelopes that it produces for $5. What is the marginal profit of the fourth worker?
A)$18
B)$22
C)-$18
D)$415

Quizplus · Accepted Answer

The marginal profit of the fourth worker is calculated by multiplying the marginal product of labor by the price per box and then subtracting the wage. For the fourth worker, the marginal product is 83 boxes, and each box sells for $5, so the total revenue generated by the fourth worker is $83 \times $5 = $415$. The wage of the fourth worker is $393. Therefore, the marginal profit is $415 - 393 = $22$.

Table 18-7 the Table Displays Data for a Small, Competitive

Table 18-7
the Table Displays Data for a Small, Competitive