Question

The following table depicts the number of boxes of strawberries that can be picked in an hour with varying amounts of labor. Calculate marginal revenue product (MRP) and answer two questions about hiring. Instructions: If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers. Number of Pickers Total Strawberry Output Total Revenue Marginal Revenue Product (per Hour) (Boxes per Hour) ($ per Box) ($ per Hour) (5) < Prey 5 of 5 Next > XCVBNMP

Answer 1

A) Marginal revenue_n = Total Revenue_n - Total Revenue_n-1 where n is number of pickers.

As marginal revenue when number of picker is 1 = Total revenue when picker is 1 - Total revenue when picker is zero

Number of Pickers	Total strawberry Output	Price	Total Revenue	Marginal Revenue
0	0	3	0	-
1	5	3	15	15
2	10	3	30	15
3	14	3	42	12
4	17	3	51	9
5	19	3	57	6
6	20	3	60	3
7	20	3	60	0
8	18	3	54	-6

b) As $325 million is to be paid over 10 years

There are 81 home games. If we wants to calculate the revenue we have to generate from per home game which would be 325 / 81 = 4.34 million

Average ticket price = $60

Assume X tickets are sold per home game each year.

Revenue = 60 X

60 X = 4.34 million

X = 0.072 million