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JAMB Economics 2008 Question 22

Question 22

Labour Market

In a perfectly competitive condition, a firm uses 10 units of labour at ₦25 and 11 units at ₦36, what is the marginal cost of labour?

  1. A.₦396
  2. B.₦323
  3. C.₦250
  4. D.₦146
Show the answer and explanation

Answer: D (₦146)

Explanation

Total cost rises from 10 × 25 = ₦250 to 11 × 36 = ₦396, so the marginal cost of labour = 396 − 250 = ₦146.