The following is a production function. Total output (Q) 50,000 45,000- 40,000- 35,000- 30,000- ง 25,000- 20,000- 15,000- 10,000- 5,000- 100 200 300 Units of labor (L) 400 Draw a graph of marginal product as a function of labor. 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 'MP Segment 2 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. OB. No, it does not exhibit diminishing returns, because the marginal product of labor is zero. OC. No, it does not exhibit diminishing returns, because the marginal product of labor is increasing. OD. Yes, it does exhibit diminishing returns, because the marginal product of labor is increasing. OE. Yes, it does exhibit diminishing returns, because the marginal product of labor is negative.

The following is a production function. Total output (Q) 50,000 45,000- 40,000- 35,000- 30,000- ง 25,000- 20,000- 15,000- 10,000- 5,000- 100 200 300 Units of labor (L) 400 Draw a graph of marginal product as a function of labor. 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 'MP Segment 2 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. OB. No, it does not exhibit diminishing returns, because the marginal product of labor is zero. OC. No, it does not exhibit diminishing returns, because the marginal product of labor is increasing. OD. Yes, it does exhibit diminishing returns, because the marginal product of labor is increasing. OE. Yes, it does exhibit diminishing returns, because the marginal product of labor is negative.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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