Essentials of Economics
4th Edition
ISBN: 9781464186653
Author: Paul Krugman, Robin Wells
Publisher: Worth Publishers
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Chapter 6, Problem 6P
To determine
Concept Introduction:
Marginal Product of Labor: It refers to the additional units of output, which is produced by employing an additional unit of labor in the current labor force.
Here,
is the change in quantity. 
is the change in labor. 
is the marginal product of labor.
Marginal Cost (MC): It refers to the rate by which the total cost of the produced good changes when the production increases by a single unit. As the fixed cost is constant irrespective of production, so the marginal cost depends on the variable cost only in the short run. Marginal cost is calculated as follows:
Here,
is the marginal cost. 
is the change in total cost 
is the change in quantity.
Fixed cost: It is a cost which is constant in the short run, it is not related to any change in the production of goods or service, it will be fixed disregarding of an increase or decrease in output.
Marginal Cost: It refers to the additional cost from an additional unit of output. It is generally the additional variable cost.
Here,
- MC is the marginal cost.
is the change in total cost 
is the change in quantity.
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Chapter 6 Solutions
Essentials of Economics
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