Stage 1 of production starts at Q = and ends at Q = where we find the diminishing marginal returns starting after QL = 6 Stage 2 of production starts after the end of Stage 1 and ends at QL 10 The remaining levels of production starting after QL= 10 refers to the Stage 3 of production. In stage 1, the marginal product is the same with the average product, thus average product is positive In stage 2, the marginal product is lower than the average product, thus average product decreases but remains posi . Stage 3 begins when the marginal product is negative. Stage 3 begins when the marginal product is less than zero As long as the marginal product is greater than zero , total product will remain increasing and will not decrease. On the

Stage 1 of production starts at Q = and ends at Q = where we find the diminishing marginal returns starting after QL = 6 Stage 2 of production starts after the end of Stage 1 and ends at QL 10 The remaining levels of production starting after QL= 10 refers to the Stage 3 of production. In stage 1, the marginal product is the same with the average product, thus average product is positive In stage 2, the marginal product is lower than the average product, thus average product decreases but remains posi . Stage 3 begins when the marginal product is negative. Stage 3 begins when the marginal product is less than zero As long as the marginal product is greater than zero , total product will remain increasing and will not decrease. On the

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter11: The Firm: Production And Costs

Section: Chapter Questions

Problem 15P

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