The GreenAcres mowing company wants to buy the new “Titan3000” lawn mowers. Assume that the lawn mowers are expected to last indefinitely, that operating expenses are negligible, and that the price per acre of mowed lawn is expected to remain constant in the future. The lawn mowing market is perfectly competitive with a market price of $25 per acre. The price of a “Titan300” lawn mower is $5,000. Exhibit 13-8 shows the number of acres that can be mowed with the new lawn mowers. The marginal revenue product of the second lawn mower is:
a. $10,000
b. $5,000
c. $2,500
d. $1750
e. $1,000
We can't see the Exhibit.
Answer is $1750.00
The marginal revenue by adding a send lawn mower is 70, the 70 * 25 dollars per acre of production.
To determine the marginal revenue product of the second lawn mower, we need to calculate the additional revenue generated by using the second mower.
The exhibit (Exhibit 13-8) shows the number of acres that can be mowed with the new lawn mowers. Unfortunately, the exhibit information is not provided in the question. Therefore, without knowing the specific number of acres that can be mowed with the second mower, we cannot determine the marginal revenue product.
If the exhibit were available, we could calculate the marginal revenue product by multiplying the market price per acre ($25) by the additional acres that can be mowed with the second mower.
Given the information provided, we cannot determine the answer to the question.