Micro Unit 5, Question 8- Hiring Workers

The video tutorial explains how to calculate the marginal product, which is the additional output from each additional worker. It then introduces the concept of marginal revenue product, which is the additional revenue generated by each worker. The tutorial guides on making hiring decisions based on these calculations, considering the marginal resource cost. Finally, it demonstrates how to calculate profit by subtracting total costs from total revenue, including fixed and variable costs, to determine if hiring workers is profitable.

What is marginal product and how is it calculated?

Explain the concept of marginal revenue product and its significance.

How do you determine whether to hire an additional worker based on marginal revenue product?

What factors contribute to total revenue and total costs in the context of hiring workers?

Calculate the profit from hiring three workers given the fixed and variable costs.