Question 34

A ceramic pottery unit hires 8 craftsmen by paying each of them Rs 900 per day. The 9th craftsman demands Rs 950 per day. If this craftsman is hired then all other craftsmen must be paid Rs 950. The marginal resource (labour) cost of the 9th craftsman is _________.

Solution

Resource(Labour) cost for 8 craftsmen before 9th craftsmen is hired$$=900\times8=7200$$

Resource(Labour) cost after 9th craftsmen is hired$$=950\times9=8550$$

The marginal resource(labour) cost of the 9th craftsmen$$=8550-7200=1350$$

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