1. Define the following terms: production function, average product, marginal product, law of diminishing marginal returns, constant returns to scale, increasing returns to scale and decreasing returns to scale. 2. Complete the table below: Variable input (Labor) 0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 Activity Total Product 250 600 1200 1900 2700 3600 4400 5000 5425 5700 5825 5900 5925 5875 Average Product Marginal Product With the values in the above table, plot Total Product (TP), Average Product (AP) and Marginal Product (MP) in single graph with units of product at the vertical axis and labor units at the horizontal axis. You can also use tw (2)graphs (TP above AP and MP curves) Label your graphs properly. Use graphing paper for your curves if you not have computer/laptop access but insert graph is recommended. 3. Describe the shapes of the curves drawn. What relationship can you observe between TP and AP curves How about between MP and TP curves? AP and MP curves? 4. With the relationship between AP and MP curves, delineate and describe the three stages of production.

1. Define the following terms: production function, average product, marginal product, law of diminishing marginal returns, constant returns to scale, increasing returns to scale and decreasing returns to scale. 2. Complete the table below: Variable input (Labor) 0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 Activity Total Product 250 600 1200 1900 2700 3600 4400 5000 5425 5700 5825 5900 5925 5875 Average Product Marginal Product With the values in the above table, plot Total Product (TP), Average Product (AP) and Marginal Product (MP) in single graph with units of product at the vertical axis and labor units at the horizontal axis. You can also use tw (2)graphs (TP above AP and MP curves) Label your graphs properly. Use graphing paper for your curves if you not have computer/laptop access but insert graph is recommended. 3. Describe the shapes of the curves drawn. What relationship can you observe between TP and AP curves How about between MP and TP curves? AP and MP curves? 4. With the relationship between AP and MP curves, delineate and describe the three stages of production.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

*Average Variable Cost The table shows the cost structure of a firm producing computer mainframes. Calculate the missing values A through H and enter these into the boxes provided. A: 20000 B: 20000 C: 277.78 D: E: F: G: Н:
The following is a production function. 50,000- 45,000- 40,000- Draw a graph of marginal product as a function of labor. 35,000- 30,000- 25,000- Total output (Q) 20,000- 15,000- 10,000 ng 5,000- 0+ 0 200 100 300 Units of labor (L) 400 L Q 1.) Using the line drawing tool, graph the marginal product curve from 0 to 100 units of labor. Label this line 'MP Segment 1" 2.) Using the line drawing tool, graph the marginal product curve from 100 to 300 units of labor. Label this line 'MPS Note: Carefully follow the instructions above and only draw the required objects. Does this graph exhibit diminishing returns? Explain your answer. ○ A. Yes, it does exhibit diminishing returns, because the marginal product of labor decreases. B. No, it does not exhibit diminishing returns, because the marginal product of labor is zero. ○ C. No, it does not exhibit diminishing returns, because the marginal product of labor is increasing. ○ D. Yes, it does exhibit diminishing returns, because the marginal…
Fill in the blanks with: (a: rising) (b: at a minimum) (c: at a maximum) (d: falling) (e: constant) 1: When marginal cost is less than average variable cost, average variable cost is: 2 When marginal product is greater than average product, average variable cost is: 3: When marginal product is negative, total product is: 4: As total output increases average fixed cost is: 5: When marginal cost is at a minimum average product is:
If the cost of an oven is $500, what is the marginal product per dollar spent on capital for the second oven? Read again before you answer. Labor Total Product Capital (ovens) (workers) (cakes) 8 6,000 8 10,000 8 13,000 Type your numeric answer and submit 123
O Macmillan Learning One feature of production in the short run is diminishing marginal returns. The graph shows a total product curve for Barry's Ball Bearings. Identify the sections of the graph that illustrate increasing (IMR), diminishing, (DMR) and negative marginal returns (NMR). Output per hour 13 12 11 10 9 8 7 6 5 4 3 2 1 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Labor units IMR Answer Bank DMR NMR
Fill in the space (d) in the table below associated with the firm William Perry, Inc., that delivers refrigerators in the Chicago area, using the two inputs of labor and trucks. Number of Amount of Trucks Labor 2 2 2 2 2 2 2 0 1 2 3456 Total Output 0 75 (c) 380 (f) Average Product of Labor (a) (b) 100 (d) (e) 75 Marginal Product of Labor 100 50 (g) 0
The following table depicts the number of grapes that can be picked in an hour with varying amounts of labor: Number of pickers (per hour) 1 2 3 4 5 6 7 8Output of grapes (in flats) 10 28 43 54 61 64 65 61Calculate marginal physical product (MPP) and then graph the total product (output) and MPP curves.
a) Calculate the marginal product (MP1) for the mixers. Does the production function have increasing, decreasing, constant marginal product for the mixers? b) Suppose in the short run the amount of machines she has is fixed at 27. How many mixers should she use? How many baklavas will she produce? How much profit will she make? c)Usinag an isoprofit, as well as the production function, draw a diagram of your soltuion from part (b). carefully label all the slopes and intercepts. d) In the long run, how many mixers should she use? How many machines? How many baklavas will she make? e) Suppose that the government decides to provide a $1 subsidy per mixer. What is the profit-maximizing amount of input to use now?
workers ouput marginal product total cost average total cost marginal cost 0 0 0 200 0 $0 1 20 20 300 $15 $5 2 50 30 400 $8 $3.33 3 90 40 500 $5.56 $2.50 4 120 30 600 $5 $3.33 5 140 20 700 $5 $5 6 150 10 800 $5.33 $10 7 155 5 900 $5.8 $20 can you explain diminishing marginal product based on these numbers?
Which of the following statements about average and marginal cost is INCORRECT? (2)(1) The marginal cost curve cuts both the average cost and average variable costcurves at their minimum points;(2) The marginal cost curve cuts both the average fixed cost and average variablecost curves at their minimum points;(3) The marginal cost curve lies below the average cost curve when average costis decreasing;(4) Marginal cost is the change in total cost when one extra unit of output isproduced.
Fill in the missing data to solve this problem. Variable Total Average MarginalInput Product Product Product4 ? 70 ----5 ? ? 406 350 ? ? What is the total product for 5 units of input, and what is the marginal product for 6 units of input?
The Production Function for Wilson Company Economists at the Wilson Company are interested in developing a production function for fertilizer plants. They collected data on 15 different plants that produce fertilizer PLANT OUTPUT (TONS) CAPITAL ($) LABOUR (HOURS) 1 605.3 18,891 700.2 2 566.1 19,201 651.8 3 647.1 20,655 822.9 4 523.7 15,082 650.3 5 712.3 20,300 859.0 6 487.5 16,079 613.0 7…