The data in the table below represents Total product (TP), for an agri-business involved in potato production. Capital (fixed factor) Labor (variable factor) Output(units) or Total physical product (TPPL) Average physical product (APPL) Marginal physical product (MPPL) 10 0 0 0 - 10 1 7 7/1 = 7.00 7 10 2 20 20/2 = 10.00 13 10 3 39 39/3 = 13.00 19 10 4 55 55/4 = 13.75 16 10 5 66 66/5 = 13.20 11 10 6 70 70/6 = 11.67 4 10 7 70 70/7 = 10.00 0 10 8 67 67/8 = 8.38 -3 At what point do diminishing marginal returns set in? And using the values of AP and MP obtained from part (i), plot the graphs of TP, AP and MP being careful to fully label the graph and explain briefly the law of diminishing marginal returns from your computation. How does the hypothesis of diminishing returns (MP& AP) influence the behaviour of costs (MC& AC)?
The data in the table below represents Total product (TP), for an agri-business involved in potato production. Capital (fixed factor) Labor (variable factor) Output(units) or Total physical product (TPPL) Average physical product (APPL) Marginal physical product (MPPL) 10 0 0 0 - 10 1 7 7/1 = 7.00 7 10 2 20 20/2 = 10.00 13 10 3 39 39/3 = 13.00 19 10 4 55 55/4 = 13.75 16 10 5 66 66/5 = 13.20 11 10 6 70 70/6 = 11.67 4 10 7 70 70/7 = 10.00 0 10 8 67 67/8 = 8.38 -3 At what point do diminishing marginal returns set in? And using the values of AP and MP obtained from part (i), plot the graphs of TP, AP and MP being careful to fully label the graph and explain briefly the law of diminishing marginal returns from your computation. How does the hypothesis of diminishing returns (MP& AP) influence the behaviour of costs (MC& AC)?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
The data in the table below represents Total product (TP), for an agri-business involved in potato production.
|
Capital (fixed factor) |
Labor (variable factor) |
Output(units) or Total physical product (TPPL) |
Average physical product (APPL) |
Marginal physical product (MPPL) |
|
10 |
0 |
0 |
0 |
- |
|
10 |
1 |
7 |
7/1 = 7.00 |
7 |
|
10 |
2 |
20 |
20/2 = 10.00 |
13 |
|
10 |
3 |
39 |
39/3 = 13.00 |
19 |
|
10 |
4 |
55 |
55/4 = 13.75 |
16 |
|
10 |
5 |
66 |
66/5 = 13.20 |
11 |
|
10 |
6 |
70 |
70/6 = 11.67 |
4 |
|
10 |
7 |
70 |
70/7 = 10.00 |
0 |
|
10 |
8 |
67 |
67/8 = 8.38 |
-3 |
- At what point do diminishing marginal returns set in? And using the values of AP and MP obtained from part (i), plot the graphs of TP, AP and MP being careful to fully label the graph and explain briefly the law of diminishing marginal returns from your computation.
- How does the hypothesis of diminishing returns (MP& AP) influence the behaviour of costs (MC& AC)?
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