Edexcel A-Level Economics QS6 Revenue, Cost and Profit Calculations

Practise Edexcel A-Level Economics cost calculations by working out marginal cost when a wage rise applies to all workers.

Exam points

Calculate marginal cost when hiring one extra worker raises the wage for all existing workers.
Avoid treating the wage rise as only the extra worker cost when total wage costs change.

[Maximum number: 1]

A car manufacturer employs 40 engineers at a wage rate of $ 570 per week. To attract an additional worker, the car manufacturer must raise the wage rate for all engineers to $590 per week.

What is the marginal cost of employing this additional worker?

$ 20

$ 820

$ 1390

$ 24190

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QS6—Revenue, cost and profit calculations question 1