Question

Question 29 (Mandatory) (5 points) Number of droids 0 1 Output of moisture (barrels per month) 0 30 55 75 90 100 2 3 4 5 Reference: Ref 12-1 Luke Skywalker's Uncle Owen operates a moisture farm on the planet Tatooine. The moisture farm utilizes droids as a resource to produce the moisture. Owen's production function is given in the accompanying table. If a barrel of moisture sells for 50 Republic Credits, what is the marginal revenue product of the fifth droid? OA) 100 barrels of moisture B) 10 barrels of moisture C) 5000 Republic Credits D) 500 Republic Credits

Answer 1

8. Given : Price of barrell = 50. Republic_Credits ser MR = dTR dB TR (Total Revenue / Price x Qua Quantity as price is constant is P so it TR = 2x 8 MR = d TR da 50XQ = 500 = 5000) 50 ܝ (Marginal Revenue Product 1 - MR = 50 MRP ( MP = ATP ΔΧ MPx MR No. droids MP Output (TP) 2 3 4 5 30 55 75 90 100 30 25 20 15. To For credits fifth droid, MRP = 10x 50 = 500 Republic D) 500 Republic Credits CS Scanned with CamScanner