Question

Your employer has asked you to start working overtime and has offered to pay $18 per hour for every hour you work beyond forty hours a week. The wage rate for each of the first forty hours will continue to be the usual $15 per hour. In terms of dollars, what is the marginal benefit of working each hour of overtime?

Answer 1

The marginal benefit of working each hour of overtime is $18.

Step-by-step explanation:

Marginal Benefit refers to the maximum price I would pay for a second (or more) product or service.

In this case, the employer is willing to pay for each extra hour the amount of $18, which means that the Marginal Benefit increases.

It is considered, that the perceived value by the employer for each extra hour is $18.