Value of marginal product (or mrp) is defined as the additional: a. revenue earned from hiring one more factor of production. b. cost of hiring one more factor of production. c. revenue earned from selling one more unit of product. d. output a firm would receive after hiring one more factor of production.

The correct answer is option a.

Explanation:

The marginal revenue product or value of marginal product is the contribution of the additional unit of input employed. It is the increase in the revenue because of an additional unit of input employed.

It is calculated as the product of marginal product of input and the price of the product.

The value of marginal product helps in determination of wage rate. When the wage rate is equal to the value of marginal product, the firm is able to maximize profit.  

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