marginal revenue product (MRP)

Marginal revenue product (MRP) is a measure of the additional revenue generated by employing one additional unit of a specific resource. It is calculated as the difference between total revenue and total cost, divided by the amount of the additional resource employed. MRP is used to help businesses determine how much to invest in a given resource in order to maximize profits. It is particularly useful for businesses that produce multiple products, as the MRP for each resource can be compared in order to determine which resource is the most valuable.