Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 25, Problem 5SPPA
To determine
To explain:
The way saving and investment in capital affect the productivity of labor, the reason for a rise in diminishing return with an example and graph of the productivity curve.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
What is one negative aspect of technology on productivity?
Technology allows for more products to be made in a shorter amount of time.
Technology allows companies to reduce the cost of making products.
Technology allows for more efficient ways to produce goods. This may lead to the elimination of jobs.
Technology allows for workers to work from home, which leads to fewer call-offs due to illness, inclement weather, or childcare-related issues.
Is it possible to increase the labor productivity in a given production process which exhibits diminishing returns to labor? If so, how? Explain with a graph
Draw the total physical product curve on graph below. . Beyond what number of workers do diminishing returns set in?
Fill in the table on the previous page to show the values of APP and MPP in columns (3) and
(4) respectively. (Remember that the MPP values should be between each unit of labour.)
Draw the APP and MPP curves on the graph
Chapter 25 Solutions
Foundations of Economics (8th Edition)
Ch. 25 - Prob. 1SPPACh. 25 - Prob. 2SPPACh. 25 - Prob. 3SPPACh. 25 - Prob. 4SPPACh. 25 - Prob. 5SPPACh. 25 - Prob. 6SPPACh. 25 - Prob. 7SPPACh. 25 - Prob. 8SPPACh. 25 - Prob. 9SPPACh. 25 - Prob. 10SPPA
Ch. 25 - Prob. 11SPPACh. 25 - Prob. 12SPPACh. 25 - Prob. 1IAPACh. 25 - Prob. 2IAPACh. 25 - Prob. 3IAPACh. 25 - Prob. 4IAPACh. 25 - Prob. 5IAPACh. 25 - Prob. 6IAPACh. 25 - Prob. 7IAPACh. 25 - Prob. 8IAPACh. 25 - Prob. 9IAPACh. 25 - Prob. 10IAPACh. 25 - Prob. 1MCQCh. 25 - Prob. 2MCQCh. 25 - Prob. 3MCQCh. 25 - Prob. 4MCQCh. 25 - Prob. 5MCQCh. 25 - Prob. 6MCQCh. 25 - Prob. 7MCQCh. 25 - Prob. 8MCQ
Knowledge Booster
Similar questions
- The concept of diminishing returns to a factor of production applies not only to capital but to labor as well. Prior to the Industrial Revolution, there was no sustained growth in living standards. Draw a graph to illustrate the relationship between population and output produced, where population is measured on the horizontal axis, both pre- and post-Industrial Revolution. 1.) Using the 3-point curve drawing tool, draw the production curve showing diminishing returns to labor. Label your curve 'Pre.' 2.) Using the 3-point curve drawing tool, draw the production curve after the Industrial Revolution. Label your curve 'Post. Carefully follow the instructions above and only draw the required objects. aarrow_forwardWhat is the impact of a fall in productivity on costs. Explain further.arrow_forwardBased on your understanding, does additional input of Labor entails a steady increase in the output of a firm? Why or Why not? Support your answer using the concept of productionarrow_forward
- The following picture represents a production function after an increase in total factor productivity z. What marginal happens to the product of labor? Y=zF(K,N) Labor (N) O It increases O It decreases O It increases from some levels of labor, it decreases for some others O Not enough informationarrow_forwardDiscuss the concept of production theory. Relate it to goals of minimizing the loss and maximizing profitabilityarrow_forwardHow does the slope of the production function illustrate diminishing returns? The slope of the production function becomes steep as the quantity of increases because of diminishing returns. A. more; capital B. more; labor O C. less; labor D. less; capital Click to select your answer. MacBook Air 吕0 000 000 FS F4 F3 esc F2 F1 % #arrow_forward
- What impact do sewing robots have on capital per worker and human capital per worker? What impact does technology have on the use of capital and human capital?arrow_forwardGive the three reasons that explain why the division of labor increases an economy’s level of production.arrow_forward▪You have fulfilled your dream by buying a McDonald’s franchise. You start hiring employees and come to realize that the first employees you hired were extremely productive, but every additional person you hired seemed to be less productive. ▪Why does that occur? Are the last people you hired just lazy? ▪The capital is fixed in the short run, but you can change your labor in the short run. ▪You decide to calculate the marginal product and the average product of your business.arrow_forward
- Graphically present the effect of technological change on production and explain it brieflyarrow_forwardEconomics Modify the Lewis model and assume that there is a strictly positive marginal product of labor in the traditional sector. Use figures with production functions in the traditional and the modern sectors to show what the equilibrium is when no one wants to move away from agriculture. What assumptions do you have to make about production functions to arrive at the conclusion that fewer people will end up in agriculture? Use the same starting point as in the above question. Derive the demand for labor in the traditional and in the modern sectors. Show graphically what the characteristics of the equilibrium would look like when no one wants to change sectors.arrow_forwardDraw a production function that shows the relationship between capital per worker and output per worker assuming there is diminishing returns to capital. Illustrate the diminishing returns to capital by showing the change in output per worker when capital is increased by 1 unit at two different levels of capital per worker.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Managerial Economics: Applications, Strategies an...EconomicsISBN:9781305506381Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. HarrisPublisher:Cengage Learning
Managerial Economics: Applications, Strategies an...
Economics
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:Cengage Learning