Answer to Question #127251 in Economics for luphiwo

Question

Consider a firm that manufactures surfboards. Presently the firm is hiring 5 workers at a wage rate of R20/hour. The firm is able to produce 50 surfboards per hour. The firm decides to hire an additional worker. The marginal product of that worker is 30 surfboards per hour. What is the marginal cost of output associated with hiring the sixth worker?

Answer 1

$50/5=10$ surfboards per worker

$20/10=2$ R per sufboard

$2*30=60$ the marginal cost