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Marginal Physical Product of Labor

Various levels of output for employment:

a. Calculate the MPPL schedule
b. Calculate the marginal physical product of labor (MPPL) and marginal cost of labor (MRCL) with a fixed wage of $5 per hour.
c. Assuming capital is constant, with 3 machines and MPPK/MRCK = 30, what is the least cost input combo of labor and capital? How much output is produced?

Workers Output
1 500
2 800
3 2000
4 2600
5 2900
6 3100

I have calculated MP:

Workers MP
1 500
2 400
3 666.67
4 650
5 580
6 516.67

I am not sure how to determine MRCL with only this information. I am also having a hard time coming up with a solution on part C.

Solution Preview

a. Calculate the MPPL schedule
refer to the EXCEL.
Note: your calculation is the average product. The correct way to compute marginal product is:
MPPL = Output2 - Output1
e.g. MPPL(from 1 to 2) = 800 - 500 = 300
b. Calculate the marginal physical product of labor (MPPL) and ...

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