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.

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter7: Proudction Costs

Section7.5: Long-run Production Costs

Problem 1YTE

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