Problem: You have been hired to manage a small manufacturing facility whose cost and production data are given in the table below.
Total Total
Workers Labor Cost Output Revenue
1 $300 50 $350
2 600 140 675
3 900 220 1120
4 1200 270 1570
5 1500 300 1865
6 1800 315 2070
7 2100 320 2170
(Q1) What is the marginal product of the second worker?
(Q2) What is the marginal revenue product of the fourth worker?
(Q3) What is the marginal cost of the first worker?
(Q4) Based on your knowledge of marginal analysis, how many workers should you hire?